Gold News

Fed interest rate decision 'won't deter investing in gold'

Although the Fed decided to keep interest rates at two per cent on Tuesday (August 5th), people considering investing in gold are not necessarily being discouraged.

The central bank also announced that it has no intention of changing its policy in the near future, despite calls for rate cuts to help counter rising global inflation.

A decrease in the base rate would see gold prices being pushed up, but a number of industry figures are still predicting that eventuality in the coming months.

Gold traders are being asked to determine whether if the brief recent rally in the dollar is for real or whether it is just a small correction in a bear market.

Dale Doelling, chief market technician at Trends in Commodities, said: "It's likely the latter as my technical indicators are beginning to signal that a bottom in gold is near.

"A test of $875 should flush out the weak longs and allow the market to mount a sustainable rally, possibly to new highs."

Furthermore, David Deahm, vice-president of Blanchard, a coin and precious metals retailer, suggests that the overall weak economy is showing no signs of improving so buying gold can still be seen as a sound investment.

He added: "Blanchard still sees gold reaching $1,150 by the end of the year."


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