Best of the Week
Most Popular
1. Dollargeddon - Gold Price to Soar Above $6,000 - P_Radomski_CFA
2.Is Gold Price On Verge Of A Bottom, See For Yourself - Chris_Vermeulen
3.Dow Stock Market Trend Forecast 2018 - Nadeem_Walayat
4.Gold Price to Plunge Below $1000 - Key Factors for Gold & Silver Investors - P_Radomski_CFA
5.Why The Uranium Price Must Go Up - Richard_Mills
6.Dow Stock Market Trend Forecast 2018 - Video - Nadeem_Walayat
7.Jim Rogers on Gold, Silver, Bitcoin and Blockchain’s “Spectacular Future” - GoldCore
8.More Signs That the Stock Market Will Rally Until 2019 - Troy_Bombardia
9.It's Time for A New Economic Strategy in Turkey - Steve_H_Hanke
10.Fiat Currency Inflation, And Collapse Insurance - Raymond_Matison
Last 7 days
Gold Exodus to Reverse - 22nd Sep 18
Bitcoin Trader SCAM WARNING - Peter Jones, Dragons Den Fake Facebook Ads - 22nd Sep 18
China Is Building the World’s Largest Innovation Economy - 21st Sep 18
How Can New Companies Succeed in the Overcrowded Online Gambling Market? - 21st Sep 18
Golden Sunsets in the Land of U.S. Dollar Hegemony - 20th Sep 18
5 Things to Keep in Mind When Buying a Luxury Car in Dubai - 20th Sep 18
Gold Price Seasonal Trend Analysis - Video - 20th Sep 18
The Stealth Reason Why the Stock Market Keeps On Rising - 20th Sep 18
Sheffield School Applications Crisis Eased by New Secondary Schools Places - 20th Sep 18
Precious Metals Sector: It’s 2013 All Over Again - 19th Sep 18
US Dollar Head & Shoulders Triggered. What's Next? - 19th Sep 18
Prepare for the Stock Market’s Volatility to Increase - 19th Sep 18
The Beginning of the End of the Dollar - 19th Sep 18
Land Rover Discovery Sport 'Approved Used' Bad Paint Job - Inchcape Chester - 19th Sep 18
Are Technology and FANG Stocks Bottoming? - 18th Sep 18
Predictive Trading Model Suggests Falling Stock Prices During US Elections - 18th Sep 18
Lehman Brothers Financial Collapse - Ten Years Later - 18th Sep 18
Financial Crisis Markets Reality Check Now in Progress - 18th Sep 18
Gold’s Ultimate Confirmation - 18th Sep 18
Omanization: a 20-year Process to Fight Volatile Oil Prices  - 18th Sep 18
Sheffield Best Secondary Schools Rankings and Trend Trajectory for Applications 2018 - 18th Sep 18
Gold / US Dollar Inverse Correlation - 17th Sep 18
The Apple Story - Trump Tariffs Penalize US Multinationals - 17th Sep 18
Wall Street Created Financial Crash Catastrophe Ten Years Later - 17th Sep 18
Trade Wars Are Going To Crash This Stock Market - 17th Sep 18
Why Is Apple Giving This Tiny Stock A $900 Million Opportunity? - 17th Sep 18
Financial Markets Macro/Micro View: Waves and Cycles - 17th Sep 18
Stock Market Bulls Prevail – for Now! - 17th Sep 18
GBPUSD Set to Explode Higher - 17th Sep 18
The China Threat - Global Crisis Hot Spots & Pressure Points - 17th Sep 18 - Jim_Willie_CB
Silver's Relationship with Gold Reaching Historical Extremes - 16th Sep 18
Emerging Markets to Follow and Those to Avoid - 16th Sep 18
Investing - Look at the Facts to Find the Truth - 16th Sep 18
Gold Stocks Forced Capitulation - 15th Sep 18
Hindenburg Omen & Consumer Confidence: More Signs of Stock Market Trouble in 2019 - 15th Sep 18
Trading The Global Future - Bad Consequences - 15th Sep 18
Central Banks Have Gone Rogue, Putting Us All at Risk - 15th Sep 18
Gold Price Seasonal Trend Analysis - 14th Sep 18
Growing Number of Small Businesses Opening – and Closing – In the UK - 14th Sep 18
Gold Price Trend Analysis - Video - 14th Sep 18
Esports Is Exploding—Here’s 3 Best Stocks to Profit From - 13th Sep 18
The Four Steel Men Behind Trump’s Trade War - 13th Sep 18
How Trump Tariffs Could Double America’s Trade Losses - 13th Sep 18
Next Financial Crisis Is Already Here! John Lewis 99% Profits CRASH - Retail Sector Collapse - 13th Sep 18
Trading Cryptocurrencies: To Win, You Must Know Where You're Wrong - 13th Sep 18
Gold, Silver, and USD Index - Three Important “Nothings” - 13th Sep 18
Precious Metals Sector On a Long-term SELL Signal - 13th Sep 18
Does Gambling Regulation Work - A Case Study - 13th Sep 18
The Ritual Burial of the US Constitution - 12th Sep 18
Stock Market Final Probe Higher ... Then the PANIC! - 12th Sep 18
Gold Nuggets And Silver Bullets - 12th Sep 18
Bitcoin Trading - SEC Strikes Again - 12th Sep 18

Market Oracle FREE Newsletter

Trading Any Market

Gold +1.8%, Silver +2.5% As Fed Increases Rates And Trade War Looms

Commodities / Gold and Silver 2018 Mar 22, 2018 - 04:18 PM GMT

By: GoldCore

Commodities

– Gold gained 1.8% and silver 2.5% to $1,333/oz and $16.60/oz yesterday
– Gold climbs as Fed increases interest rates by 0.25% – now 1.5% to 1.75% range
– Dovish Fed Chair Powell plans fewer than expected rate hikes in 2018

– Markets disappointed at lack of hawkish comments from new Fed Chair 
– Dollar LIBOR rises to highest level since November 2008 – $200 trillion worth of dollar-denominated financial products including mortgages based off LIBOR

– Trade wars look set to escalate and Trump expected to announce tariffs on Chinese imports today


Editor: Mark O’Byrne


Gold in USD – 1 Week (GoldCore)

Gold gained 1.7% and silver 2.5% to $1,333/oz and $16.60/oz respectively yesterday after the Federal Reserve announced a 25 basis point increase in rates to the slightly higher range of 1.5% to 1.75%. Gold and silver consolidated on those gains overnight in Asia and this morning in European trading, as markets digested the Federal Reserve’s post-announcement comments.

The first Federal Reserve meeting chaired by Jerome Powell offered little in the way of surprise. A hawkish tone was expected from new Chair Powell, however his statement was slightly more dovish despite what he claimed was a strengthened economic outlook and confidence that tax cuts and government spending will provide an much needed boost.


Source: @JohnFeeney10

The Fed confirmed that there would be just three rate hikes this year, as stated in the December 2017 minutes. Currently the interest rate remains 50bp below LIBOR which continues to climb, widening the spread between itself and OIS.

Should this continue to worsen the impact could be greater on the economy and wealth, than Fed set interest rates. On this basis, the Powell and co. may well decide on additional rate hikes on top of the two expected this year and those forecast for 2019 and 2020.

Yesterday CME Group reported that speculative betting on future Fed rate rises in June are 84.4% likely (up from 58.5% a month ago) and September’s meeting 52.2% (jumping from 37.3% a month ago).


Data shows rising interest rates is positive for gold as seen in 1970s and again from 2003 to 2007. Source: New York Federal Reserve for Fed Funds Rate, LBMA.org.uk for Gold (PM fix)

Gold to find further support in trade wars

Later today President Trump will almost certainly announce tariffs on Chinese imports. The White House is said to be considering between $30bn-$60bn in tariffs and measures that would restrict investment. Yesterday the country’s top trade negotiator, Robert Lighthizer, told Congress the US will put “maximum pressure on China and minimum pressure on US consumers”.


Any changes to current trade arrangements will no doubt increase tension between the super powers. Many expect retaliation from Beijing (to any US measures) prompting a trade war and there is also the real of currency wars returning with a vengeance.

Elsewhere, EU leaders will today consider how best to respond to Trump’s decision to place tariffs on aluminium and steel imports, another move likely to trigger a trade war.

Recent Fed meetings and interest rate announcements have coincided with short term lows in the gold price and a good entry point for those looking to accumulate on the dip (see chart above).

We expect the same on this occasion and we should again test resistance at $1,360/oz in the coming weeks. Growing uncertainty and deepening risks will provide further support for gold and should see higher gold prices.

Listen on SoundCloud , Blubrry & iTunesWatch on YouTube below

Gold Prices (LBMA AM)

22 Mar: USD 1,328.85, GBP 939.36 & EUR 1,078.10 per ounce
21 Mar: USD 1,316.35, GBP 935.53 & EUR 1,071.64 per ounce
20 Mar: USD 1,312.75, GBP 935.60 & EUR 1,066.22 per ounce
19 Mar: USD 1,311.70, GBP 934.59 & EUR 1,066.41 per ounce
16 Mar: USD 1,320.05, GBP 945.42 & EUR 1,071.09 per ounce
15 Mar: USD 1,323.35, GBP 949.24 & EUR 1,070.72 per ounce
14 Mar: USD 1,324.95, GBP 949.59 & EUR 1,071.35 per ounce

Silver Prices (LBMA)

22 Mar: USD 16.52, GBP 11.64 & EUR 13.41 per ounce
21 Mar: USD 16.25, GBP 11.56 & EUR 13.23 per ounce
20 Mar: USD 16.25, GBP 11.60 & EUR 13.22 per ounce
19 Mar: USD 16.29, GBP 11.59 & EUR 13.24 per ounce
16 Mar: USD 16.48, GBP 11.79 & EUR 13.36 per ounce
15 Mar: USD 16.52, GBP 11.86 & EUR 13.37 per ounce
14 Mar: USD 16.61, GBP 11.88 & EUR 13.42 per ounce

Mark O'Byrne

Executive Director

This update can be found on the GoldCore blog here.

IRL
63
FITZWILLIAM SQUARE
DUBLIN 2

E info@goldcore.com

UK
NO. 1 CORNHILL
LONDON 2
EC3V 3ND

IRL +353 (0)1 632 5010
UK +44 (0)203 086 9200
US +1 (302)635 1160

W http://www.goldcore.com/uk/

WINNERS MoneyMate and Investor Magazine Financial Analysts 2006

Disclaimer: The information in this document has been obtained from sources, which we believe to be reliable. We cannot guarantee its accuracy or completeness. It does not constitute a solicitation for the purchase or sale of any investment. Any person acting on the information containd in this document does so at their own risk. Recommendations in this document may not be suitable for all investors. Individual circumstances should be considered before a decision to invest is taken. Investors should note the following: Past experience is not necessarily a guide to future performance. The value of investments may fall or rise against investors' interests. Income levels from investments may fluctuate. Changes in exchange rates may have an adverse effect on the value of, or income from, investments denominated in foreign currencies. GoldCore Limited, trading as GoldCore is a Multi-Agency Intermediary regulated by the Irish Financial Regulator.

GoldCore is committed to complying with the requirements of the Data Protection Act. This means that in the provision of our services, appropriate personal information is processed and kept securely. It also means that we will never sell your details to a third party. The information you provide will remain confidential and may be used for the provision of related services. Such information may be disclosed in confidence to agents or service providers, regulatory bodies and group companies. You have the right to ask for a copy of certain information held by us in our records in return for payment of a small fee. You also have the right to require us to correct any inaccuracies in your information. The details you are being asked to supply may be used to provide you with information about other products and services either from GoldCore or other group companies or to provide services which any member of the group has arranged for you with a third party. If you do not wish to receive such contact, please write to the Marketing Manager GoldCore, 63 Fitzwilliam Square, Dublin 2 marking the envelope 'data protection'

GoldCore Archive

© 2005-2018 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules