Next Week Matters For Gold Prices! What to Expect?

With the massive drop in US stocks, it seems highly likely that market participants will reckon with next week’s FOMC meeting and a more hawkish Federal Reserve. Commenting on the developments for gold prices, analyst Gary S.Wagner’s evaluations and forecasts cryptocoin.com compiled for our readers.

“We may see higher moves for gold prices despite Fed”

Since the beginning of the recession in the US, companies have become dependent on borrowing at an exorbitantly low interest rate. This week’s decline was a symptom of the reality companies are facing. That means the cost of borrowing capital will rise throughout the year as the Federal Reserve begins normalizing interest rates after reducing asset purchases that should be completed by March this year.

According to the analyst, this week’s drastic drop in equities could be a symptom of withdrawal symptoms as companies are faced with the fact that they can no longer borrow money without interest rate costs. After witnessing a week where stocks fell sharply from Tuesday to Friday and precious metals gained value from Tuesday to Thursday, one might ask what’s different today. The analyst makes the following assessment for this question:

One possibility is that market participants in the precious metals markets are reaching a tipping point today as continued selling pressure in US equities has led to a massive liquidation in multiple asset classes.

“The reality is that US stocks are much more sensitive to interest rate hikes than precious metals traders in the current market environment,” he said. indicates that it will not have a major impact. In addition, the analyst comments:

Therefore, we may continue to see higher movements for gold prices even if the Federal Reserve opts for a much less supportive monetary policy.

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