Gold Traders Have Been Holding Back The Last Few Days

Gold traders have been holding back the last few days, waiting to hear what the Federal Reserve has to say regarding the direction of interest rates in the US. So far, the Gold market is factoring in a 25-basis point increase in the Fed Funds rate, but traders will be looking closely to the wording of the Fed's statement to see if they are near the end of their tightening campaign. A hawkish statement would be interpreted as bearish for the Gold market, as higher interest interest rates may lead to a stronger US Dollar, which makes Gold more expensive in foreign currencies,and cuts demand. If it appears that the Fed is done raising rates, then traders believe a Gold rally is in store. We will find out what's in store when the Fed announces its decision at 1:15 pm Chicago time today. Read More....