Gold futures decreased with 5%
The contracts on gold futures decreased with 5% during the last week due to massive sales after Fed stated that labor market guarantee course of recovery. The positive assessment of the largest economy in the world reduce demand for investment havens such as what is still perceived the gold. The gold with December delivery fell […]
The contracts on gold futures decreased with 5% during the last week due to massive sales after Fed stated that labor market guarantee course of recovery. The positive assessment of the largest economy in the world reduce demand for investment havens such as what is still perceived the gold. The gold with December delivery fell with 4.7% at the close of the session on Friday to 1,173.30 USD per ounce. Thus the asset fell below the psychological barrier of 1,200 USD for the first time since the end of September. At the end of last week the value reached 1,228.80 USD per ounce. The price of the contracts reached a weekly high of 1,234.40 USD per ounce on Tuesday, and the bottom of the first was 1,160.20 USD on Friday.
As regards the daily changes, the price of metal varied over the majority of the week. The value decreased by 0.49% on Monday, only to rise by 0.37% on Tuesday. On Wednesday – the day when the Federal Open Market committee (FOMC) ended its October meeting, the yellow metal fell 1.21%. Raw material fell 1.28% more on Thursday and subsidence continued in the next day – Friday, when the asset wiped 2.11% of its value.
The biggest driving force for change in the price of gold was undoubtedly FOMC, which has decided to terminate its full program for the purchase of assets. The main reason for moderate optimism the Fed was the state of the US economy. Nevertheless, the institution would not disclose when and plans to take a long-awaited rise in interest rates. Fed repeated its pledge to keep interest rates near zero for “a substantial period of time” based its decision on the positive signals from the US labor market and the gradual reduction of spare capacity in the economy.
The US central bank still add a new paragraph at the end of its opinion, which analyzed post-QE. According institution rising interest rates will come sooner if progress toward goals happen faster than expected. On the other hand, the declaration stated that the Fed will delay the start of policy tightening, if the same progress is slow. This means that if the economy is on track time to lift the level of the federal funds rate remains June 2015.