Gold hits 2-week high ahead of US Fed meeting. Should you buy in this rally?
US Federal Reserve meeting on September 19-20. Spot gold was down 0.1% at $1,930.39 per ounce by 0638 GMT, but hovered near its highest since September 5 hit earlier in the session.
US gold futures edged down 0.1% to $1,951.60. The Fed is overwhelmingly expected to keep rates unchanged when it announces its policy decision on Wednesday.
According to Sugandha Sachdeva, Executive Director & Chief Strategist at Acme Investment Advisors, one of the key factors weighing on gold prices is the increasing belief that the US Federal Reserve will implement another interest rate hike by the end of this year. However, the prevailing market consensus suggests that the Fed will maintain interest rates at their current levels during its forthcoming policy meeting, scheduled for September 19-20, added Sachdeva.
“As of now, gold prices have managed to hold well above the crucial support level of Rs. 58,500 per 10 gms on a closing basis, even in the face of rising greenback.
Should this support level hold, gold prices are expected to make a gradual ascent towards the range of Rs.59,500-59,800 per 10 gms in the coming days," said Sachdeva. “Gold continues to trade steady after a recovery seen towards the end of the previous week, as investors continued to price in a pause in interest rate hikes by the Federal Reserve at their policy meeting Fed officials have been giving mixed statements regarding the interest rate expectations however, they agree that inflation concerns still exist and the Fed's efforts to bring the same down to its target of 2% will continue," said Navneet Damani, Senior VP – Commodity Research at Motilal Oswal Financial Services On the domestic front, prices could hover in the range of ₹58,700 – 59,300 could be
. Read more on livemint.com
