Gold Drops to 1 Month Low Ahead of FOMC

Gold fell to a one-month low on Friday, heading for a third successive weekly loss, as uncertainty over the timing of the U.S. Federal Reserve’s first interest rate increase in nearly a decade weighed on appetite for the metal.

Prices are down 2 percent this week, and touched their weakest level since August 11 at $1,099.05 an ounce on Wednesday.

Spot gold was down 1 percent at $1,099.85 an ounce , while U.S. gold futures for December delivery were down $10 an ounce at $1,099.20.

Traders are awaiting the Fed’s next policy statement on Sept. 17 for clues on the timing of a U.S. interest rate rise, before taking any big positions in gold.

Gold has benefited in recent years from ultra-low rates, which cut the opportunity cost of holding non-yielding bullion while weighing on the dollar, in which it is priced.

via CNBC

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza