Gold creeps higher ahead of Fed

Investors are squaring up their positions before the Federal Reserve meeting tonight.

Gold is currently trading at $1261, up 0.4% after losing ground over the past two days. All eyes will be on the Federal Reserve tonight, as economists are expecting a further reduction in the stimulus package; December’s taper reduction pushed the price of gold below the $1200 mark. Tonight, consensus expects a reduction by $10 billion – more than this could ensure gold heads lower.

The Turkish central bank hiked interest rates overnight in an effort to stop the Turkish lira from collapsing, which has brought stability and confidence to the financial markets. Gold rallied at the end of last week as there was major worry over the Argentine peso and the Turkish lira, and if these concerns resurface we could retest the $1300 level as Alastair McCaig stated. 

Spot gold chart

IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

This information/research prepared by IGA or IGA Group is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

See important Research Disclaimer.