The price of gold rose on Friday, but bullion closed the week below day’s best levels after Federal Reserve Chairman Jerome Powell raised the possibility that the central bank will soon begin to slow or contract monthly bond purchases. So, what levels are next?
Fed’s statements continue to affect gold: What did Powell say?
cryptocoin.com As we reported earlier, Powell said on Friday that higher US inflation readings will continue into next year, and the central bank is on alert for the risk that consumers may begin to expect higher inflation. He also said it was “time to cut back” the Fed’s $120 billion monthly asset purchases. The policy makers of the central bank will hold their next meeting on November 2-3.
Powell also said that inflation will be longer than previously expected and monetary instruments will be used if inflation rises longer than expected. He also said that the US labor market could continue to improve so that it could reach “maximum employment” next year, and if that happens, it would remove the last major hurdle to any rate hikes.
Chintan Karnani: Gold price supported by inflation concerns
Insignia Consultants research director Chintan Karnani said gold gave up most of Friday’s early gains after Powell’s statements to cut back on bond purchases. Karnani said traders are “waiting for an indication” of a rate hike after the Fed cut its asset purchases. Gold fell from its peaks “with a combination of weekend profit taking and technical selling” after the Fed chairman’s speech, according to Karnani.
Still, “the gold price is supported by inflation concerns,” said Karnani, adding that Russia’s central bank has increased interest rates to counter inflation. He pointed out that the next two weeks include key central bank meetings of the Bank of England, the European Central Bank, the Bank of Japan and the US Fed. In Powell’s speech on Friday, Karnani said he did not expect any surprises from the Fed as “everything became clear”.
Wyckoff: Markets are ‘waking up to reality’
Senior analyst Jim Wyckoff said in a daily note that gold and silver were “supported by escalating concerns over troubled price inflation and a lower US dollar index to end the trading week.” Wyckoff said that both the gold and silver markets were “finally awakening to the fact that global inflation is rising and that this will probably not be temporary,” adding the following statements:
Gold prices have been rising since late September, and silver prices hit a six-week high this week. History shows that fixed assets such as precious metals are more preferred as an inflation hedge as consumer and producer prices rise.
Contact us to be instantly informed about the last minute developments. twitter‘in, Facebookin and InstagramFollow and Telegram and YouTube join our channel!
Disclaimer: The articles and articles on Kriptokoin.com do not constitute investment advice. Cryptokoin.com does not recommend buying or selling any cryptocurrencies or digital assets, nor is Kriptokoin.com an investment advisor. For this reason, Kriptokoin.com and the authors of the articles on the site cannot be held responsible for your investment decisions. Readers should do their own research before taking any action regarding the company, asset or service in this article.
Warning: Citing the news content of Kriptokoin.com and quoting by giving a link is subject to the permission of Kriptokoin.com. No content on the site can be copied, reproduced or published on any platform without permission. Legal action will be taken against those who use the code, design, text, graphics and all other content of Kriptokoin.com in violation of intellectual property law and relevant legislation.