Gold Price Holds Near $1,710, Awaits Fed, Bernanke
GOLD PRICE NEWS – The gold price stabilized near $1,710 per ounce Wednesday morning as investors awaited the outcome of today’s Federal Reserve meeting. Gold prices have come under considerable pressure over the past two weeks amid broad-based weakness in financial markets and a rebound in the U.S. dollar. On a month-to-date basis, the spot price of gold is now down by 3.8% and on pace to snap a four-month winning streak.
Silver held steady alongside the gold price this morning, inching up by $0.07, or 0.2%, to $31.77 per ounce. However, gold’s sister precious metal has experienced a challenging period of late as well, dropping 8.0% thus far in October. Furthermore, silver is also on track to post its first losing month since May.
Gold stocks mirrored the stability in gold prices, as the Market Vectors Gold Miners ETF (GDX) oscillated between gains and losses near $50.95 per share. The GDX has fallen 5.1% in October and is at risk of posting its first losing month since May.
On Wednesday, the majority of large-cap gold stocks posted modest advances. Barrick Gold (ABX) rose by 0.1% to $38.93 per share, IAMGOLD (IAG) by 0.5% to $15.40, and Kinross Gold (KGC) by 0.8% to $9.96 per share.
(Visit GoldAlert Pro at http://pro.goldalert.com for analysis and rankings of every gold stock in the GDX)
As for the Federal Reserve, while last month’s Federal Open Market Committee (FOMC) meeting marked the start of the open-ended third round of quantitative easing (QE3), today’s session is expected to contain far less significant announcements. Instead, most market strategists are anticipating that Chairman Ben Bernanke and his fellow central bankers will focus more on their forecasts for the U.S. economy given that QE3 is only in its early stages.
Ward McCarthy, chief financial economist at Jefferies, wrote in a note to clients yesterday that “I think they’re going to be sitting around talking about communications for the next two days. There’s some possibility that they change the way they talk about the rate guidance in that they put it in the context of their economic forecast or metrics that would be consistent with their dual mandate.”
With the Fed unlikely to launch any additional accommodative monetary policy measures at today’s meeting, gold prices could remain under “modest” pressure in the near term – according to analysts at HSBC. The firm noted in a report on Wednesday that if the next level of support for the price of gold is at $1,700 per ounce, followed by $1,660, “which coincides with gold prices before Fed Chairmen Ben Bernanke’s speech on economic policy at a Jackson Hole, Wyoming, summit on 31 August.”
2012-10-24 11:20:14
Source: http://www.goldalert.com/2012/10/gold-price-holds-near-1710-awaits-fed-bernanke/
Source:
