Source: Reuters
Author: Brijesh Patel
Article: Original article
Publication date: Wednesday, November 16, 2022
On Wednesday, gold prices declined from a three-month high hit in the previous trading session. In addition to weakening producer price inflation in the U.S., geopolitical tension was the driving force for gold to grow yesterday. These drivers proved to be unsteady for the growth.
DailyFX currency strategist Ilya Spivak said that gold was still largely dependent on the Fed's decisions. He added that gold continued its growth since last week's spike but it didn't find tremendous follow-through.
Tuesday figures revealed that producer prices in the U.S. rose less than expected in October, which is another evidence of declining inflation. These data lifted hopes that the Fed could moderate the size of its interest-rate increases in the future.
Although investing in gold is typically considered to be a hedge during political and financial uncertainty, interest rate hikes tend to dim bullion's appeal as metal is non-yielding.
Forecast:
Gold correction after the rally seen in recent days
This content is for informational purposes only and is not intended to be investing advice.
