30-08-2018 04:30 PM
Gold price dropped on Thursday and is about to record a fifth monthly fall on outlook of a higher interest rate, whereas the dollar also moved lower.
Gold prices were trading lower at $ 1207.60 at the time of preparing this report.
Investorsbroadlylook forward to the Federal Reserve to hike interest rates in September and December following last week’s Jackson Hole symposium, where Fed’s chairman Jerome Powell shielded policy of interest rate hikes, adding up that he expected a low down but slowincrease of interest rates as inflation is reaching the country’s 2% target.
Powell’s speech was delivered after U.S. President Donald Trump said earlier this month that he was “not thrilled” about the Fed’s decision to hike rates. A latent hike in interest rates in general diminishes demand for gold, which yields no interests.
In the meantime, the U.S. reported on Wednesday the strongest growth of its second-quarter GDP in a decade, expanding at an annual rate of 4.2%.
According to Mr.Sunil Kumar, Market Expert & Director at Enrich Commodities - “Investors are strugglingin the midst ofoptimistic data coming through from the U.S. and that’s why prices of gold are stuck just above $1,200 currently without any sort of clear viewpoint, particularly around the rates for 2019.
The U.S. Dollar Index fell 0.03% to 94.57. The index gained slightly from a four-week low of 94.434 on Tuesday.