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(Kitco News) – The gold market is off its highs and struggling to hold above $2,000 an ounce as the Federal Reserve signals it will hold interest rates in restrictive territory for the foreseeable future.
According to the minutes from the central bank’s November monetary policy meeting, the Federal Reserve is maintaining a slight tightening bias. Although Fed Funds rate is close to a peak, the central bank appears to be in no hurry to lower interest rates anytime soon.
“Participants continued to judge that it was critical that the stance of monetary policy be kept sufficiently restrictive to return inflation to the Committee’s 2 percent objective over time,” according to the Minutes. “All participants agreed that the Committee was in a position to proceed carefully and that policy decisions at every meeting would continue to be based on the totality of incoming information and its implications for the economic outlook as well as the balance of risks.”
The gold market is not seeing much reaction to the Fed’s elevated neutral stance. December gold futures last traded at $1,999.60 an ounce up nearly 1% on the day.
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.
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