In the middle of July, gold spot price reached its highest since May. Having some gold in your portfolio or pocket is always a sensible idea, but is it a favorable moment to buy XAU right now? Let's delve into the reasons behind the metal's recent growth this summer, what we can expect next, and how it's all linked to the forthcoming Fed meeting.
The main reason behind the fluctuations in gold prices is its inverse correlation with the US dollar. As inflation recedes and investors expect a halt in the US interest rate hike, the USD becomes less attractive for market participants. When this occurs, people pay attention to other assets like stocks and gold – the XAU transforms into a safe haven.
However, as evident from the chart, there was a slight drop after the rise in gold prices, which occurred just before the Fed meeting. Experts have no doubts about the next 25-basis-point hike of the interest rate by the Federal Reserve. In fact, this increase has likely already been factored into the current rate. The most essential aspect is the words, not the numbers.
Business Business Latest News, Business Business Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Source: KitcoNewsNOW - 🏆 13. / 78 Read more »