Gold Takes ‘Brunt of the Selling’ as Fed Primes Markets for Hike

Gold is heading for the longest run of weekly losses this year courtesy of the Federal Reserve, which signaled in comments from policy makers and meeting minutes that U.S. interest rates may rise as early as June.

Bullion for immediate delivery was little changed at $1,254.05 an ounce at 2:55 p.m. in Singapore, down for a third week, the longest losing streak since November, according to Bloomberg generic pricing. It sank to $1,243.90 on Thursday, the lowest since April 28, as a resurgent dollar hurt demand.

Gold’s rally in 2016, which saw prices climb to a 15-month high, has been thrown into reverse as investors reassess the likelihood of higher U.S. borrowing costs, which damp the appeal of bullion. Following the release of the April minutes that suggested increases were on the cards, New York Fed President William Dudley said on Thursday a June-July time frame for a hike was reasonable, while Richmond Fed President Jeffrey Lacker said there was a very strong case for a raise next month.

Bloomberg

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Craig Erlam
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the BBC and The Telegraph, and he also appears regularly as a guest commentator on Bloomberg TV, CNBC, FOX Business and BNN. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam

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