GOLD PRICE RALLIES; MARKET AWAITS FED MINUTES As on 05-January-2017 | Bullion India

GOLD PRICE RALLIES; MARKET AWAITS FED MINUTES

Gold was trading in positive territory on Wednesday January 4, continuing the rally from the previous session.

The spot gold price was recently quoted at $1,164.85/1,165.15 per oz, up $8.05 on the previous close. Trade has ranged from $1,156.25 to $1,167.70 so far.

There are many supporting factors for gold’s rally, especially all the uncertainty that lies ahead with the changeover in the US administration, Brexit and the weakening trend in the yuan. Bitcoin prices are rallying sharply, which is widely being attributed to Chinese investors looking to reduce exposure to their currency, William Adams, Metal Bulletin analyst, said.

“The rising dollar and the environment of higher interest rates were always going to be headwinds, but not insurmountable ones, if investors were looking for safety,” Adams added.

“Since the US election, confidence has been running high and safe havens are not in demand. But now we are in 2017 and with so much political uncertainty ahead, we think gold will become a sought-after asset again, especially given that its price has already corrected – unlike most other asset classes,” he said.

In data today, the minutes of the latest meeting of the US Federal Reserve on 14 December will be published this evening. The Fed had increased interest rates at this meeting, and raised the prospect of three further rate hikes in 2017.

“In the minutes, traders should not expect to see the specific rate hike path that the Fed will follow,” Swissquote said. “This year’s hot topic will be the fiscal stimulus that Trump is promising and, of course, inflation. We are certainly at a reflection point and alternatives to stimulate the economy are being seriously considered.”

In the other precious metals, spot silver was last quoted at $16.38/16.40 per oz, up 12 cents. Platinum at $941/946 was $19 higher and palladium at $728/733 was $24 higher.

It is possible that some market participants have been buying palladium in particular in anticipation of record-high vehicle sales in the USA, Commerzbank said. The sales figures for 2016 as a whole will be released this evening.

Source:- www.bulliondesk.com

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