Gold prices jump to a five-year high after the Fed’s announcement
Gold prices are at an all-time low since March 2014 • The price per ounce added 3% to $ 1,378 • Experts link the rise to the dollar’s weakness and the Fed’s announcement yesterday that opens the door to a rate cut in the coming year
Gold prices are up 3% on Asian bourses Thursday following the Fed’s conciliatory announcement yesterday, leaving the possibility of a future rate cut to $ 1,378 an ounce.
The Federal Reserve left the interest rate at 2.25% -2.5% at the end of a two-day open-ended meeting of the Open Market Committee, which was in line with market analysts’ forecasts, but the Federal Reserve expects to cut interest rates by 2020. The treasury’s yield fell below 2% for the first time since November 2016 and broke an important psychological barrier.
The expectation that the Fed will lower interest rates next year has made gold attractive, explains Rob Kernell, a senior economist at ING. Another market analyst, Han Tan, who works for Forex, attributed the rise in gold prices to the weakening of the dollar following the Fed’s announcement: “The weakening of the dollar following the Fed’s conciliatory announcement triggered a rise in gold prices on the basis of the gloomy outlook for the global economy, .