Tag Archive: central bank

Any Day Now

The gold market is trading slightly higher to kick off the new trading week. This week will likely see lighter trading volumes due to the Thanksgiving holiday, with many investors taking off Friday as well. The gold market appears to be in consolidation mode and could be getting ready for a significant upside breakout. The market has passed an important test in recent sessions, as the recent dip down to the $1200 level found willing buyers. The catalyst for the next major move higher could... Continue Reading

Are Hikes Beginning to Hurt?

The subject of the Fed and its plans to continue with gradual rate hikes has been the topic of considerable debate in recent months. Thus far, the central bank has stuck to its guns and moved ahead with more hikes. In fact, the central bank has another hike planned before the end of the year and currently has three more penciled in for next year. It’s no secret that the Fed has drawn some criticism. Even President Trump has weighed in on the issue. The... Continue Reading

Who Cares if the Fed is Hawkish?

The gold market is up again today, and appears to now be in consolidation mode following strong gains last week. Some sideways price action this week should not only come as no surprise, but should also be viewed as healthy. The bulls may simply be gearing up for the next major push higher. Recent price action in gold has certainly been constructive. The market has covered almost $50 per ounce in upside, and could just be getting started. The recent rally and improving technical posture... Continue Reading

Let the Coiling Continue

The last several months have unquestionably been challenging for the gold market. Higher stocks, a stronger dollar and overall robust appetite for risk have all played a role in the metal’s lack of upside. Although it is unclear of the market has yet found a long-term bottom, recent price action would seem to suggest that a bottom is at hand, or very close. The market has been consolidating in recent days as it tries to hold the psychologically important $1200 level. The selling pressure appears... Continue Reading

Is This Week all About the Fed?

There is certainly no shortage of things happening right now that could potentially affect financial asset prices. One of the major potential catalysts for price action this week is likely to be Wednesday’s Fed meeting. It is widely expected that the central bank will take another step towards normalizing monetary policy. The central bank will likely raise the Fed Funds Rate by another 25 basis points. Markets seem prepared for such a move from the Fed, and will probably be far more interested in what... Continue Reading

No Easy Way Out

Now that new Fed Chairman Jerome Powell has taken the reigns, investors seem to be getting a sense that the central bank is not likely to deviate from its previous course under Janet Yellen. The central bank is still sticking with three possible rate hikes for this year, and the possibility of a fourth or perhaps larger hike are also on the table. The central bank now finds itself in a very difficult, if not impossible, situation. It has to attempt to control accelerating inflation... Continue Reading

Could Inflation Be Lurking Around the Corner?

It’s no secret that inflation levels have been running well below the Fed’s desired target of two percent. Despite stubbornly low inflation levels, the central bank stands ready to hike rates further in 2018, perhaps as many as three times. Does the central bank know something the rest of us don’t? While the conspiracy theorists may be disappointed, the answer is probably not. Inflation has remained below desired levels, and it seems to be a thorn in the Fed’s side. Although inflation reports and other... Continue Reading

Buying Opportunity

The price of gold has seen some moderate declines in recent days. Although some may attribute these declines to the FOMC meeting commentary on Wednesday, there may be other, simpler forces at work. On Wednesday, the Fed reiterated its plans for another interest rate hike this year, and the central bank says it remains on track for another three rate hikes next year. The Fed seems intent on following through with its plans despite a significant lack of inflation and other issues that could potentially... Continue Reading

Do They Have It All Wrong?

There seems to be a large consensus that the potential for further rate hikes from the Fed in the second quarter and beyond could derail the rally seen in gold in recent months. A more aggressive central bank, a stronger dollar index and robust appetite for risk are all reasons given for what could be the yellow metal’s “demise.” Thus far, however, none of these issues or potential issues has been able to put a halt to the buying in gold. In fact, the gold... Continue Reading

Latest Fed Minutes Most Hawkish In Years-Or Are They?

Last week, investors got the latest release of the FOMC meeting minutes. Although at first glance the minutes appeared to be considerably more hawkish, the central bank did also cite some risk it sees in the New Year. While it can also be a matter of interpretation to a degree, upon a closer examination of the minutes the Fed still seems rather cautious. The central bank voted to raise rates last month for just the second time in a decade, and while the Fed now... Continue Reading