The Gold slump continued in early European trading, as investor focus moved towards the release of minutes from the latest Fed Reserve meeting. Investors will be looking to the minutes release for clues on the timing and pace of intended interest rate hikes.
The precious metal has been declining throughout the week, primarily due to a risk-on attitude and a strengthened US Dollar. In a quiet trading week so far, many investors have been cautious on gold with one eye on the upcoming minutes release. Gold is sensitive to U.S interest rate moves which raise the opportunity cost of having non-yielding assets such as dollar-priced precious metals.
Gold has been on a steady decline all week with the rate hike taking centre stage. The Fed kept rates steady after it’s February 1 meeting, having painted a relatively positive picture of the U.S economy. However, the central bank offered no firm indication on the timing of its next interest rate raise. Fed Chair Janet Yellen cited uncertainty over Donald Trump’s economic policy.
Having fallen 0.33% at one point, the gold slump was kept in check by a round of profit taking. At time of writing, Gold is down 0.11%, with a troy ounce trading at $1237.75. Meanwhile, Silver is 0.05% lower, with a troy ounce valued at $17.998.