Gold Rises After Fed FOMC Statement

Gold turned positive and rose to a 12-week high on Wednesday, after the U.S. Federal Reserve said it was “closely monitoring” global economic and financial developments, and held interest rates steady as expected.

The central bank removed a previous reference from its statement to the risks of the economic outlook being balanced and said it was weighing how the global economy and financial markets could affect the outlook.

“Gold has risen to highs of this rally as the FOMC provided a perfunctory yet cordial nod to doves by removing ‘risks are balanced’ and acknowledging market conditions,” said Tai Wong, director of base and precious metals trading for BMO Capital Markets in New York.

“For gold bulls, it is an invitation to push gold higher before the next major hurdle which is the February employment report.”

Spot gold was up 0.6 percent at $1,126.70 an ounce at 2:55 p.m. EST (1955 GMT), the highest since Nov. 3, after trading down 0.5 prior to the Fed statement.

U.S. gold for February delivery settled down 0.4 percent at $1,115.80 per ounce, before the Fed statement.

via Business Standard

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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