29 Jan 2015
Gold dips as US rate hike expectations remain intact
FXStreet (Mumbai) - Gold prices dipped in Asia and continue to trade weak ahead of the European session after the Federal Reserve sounded upbeat on the US economy.
Low inflation amid solid growth in the US
The yellow metal weakened as it lost its appeal as a hedge for inflation and safe haven asset after the Fed statement released yesterday said the US economy continues to expand at a solid pace, while the inflation is likely to fall in the near-term.
Moreover, the statement did little to alter the market expectation regarding the timing of interest rate hike in the US. Furthermore, no comments were made regarding the surging USD index. Thus, the US dollar surged, which further hurt Gold prices.
Gold Technical Levels
The metal currently trades 0.54% lower at USD 1280.20/Oz levels. The immediate support is located at 1275.6 and 1272.1 levels. On the flip side, resistance is seen at 1284.2 and 1292.1 levels.
Low inflation amid solid growth in the US
The yellow metal weakened as it lost its appeal as a hedge for inflation and safe haven asset after the Fed statement released yesterday said the US economy continues to expand at a solid pace, while the inflation is likely to fall in the near-term.
Moreover, the statement did little to alter the market expectation regarding the timing of interest rate hike in the US. Furthermore, no comments were made regarding the surging USD index. Thus, the US dollar surged, which further hurt Gold prices.
Gold Technical Levels
The metal currently trades 0.54% lower at USD 1280.20/Oz levels. The immediate support is located at 1275.6 and 1272.1 levels. On the flip side, resistance is seen at 1284.2 and 1292.1 levels.