Gold futures have remained high today (December 11th), with major investments on hold as markets wait on the next Federal Reserve decision on interest rates.
Gold for February delivery fell away only 40 cents as news of a potential rate cut was awaited, allowing the metal to remain above $813 per ounce on the New York Mercantile Exchange, solidifying yesterdays rise.
On Monday gold futures soared $13.30 to break away from their pegging around $800, with their refusal to fall back today perhaps a sign of gold's readiness to stage another major rally, rather than fall prey to profit taking once a high enough price is reached.
Analysts at Action Economics told MarketWatch: "The market is likely to rally if the Fed cuts rates as expected, as such a move would indicate that the central bank puts growth concerns over inflation concerns, which lifts the appeal of gold as a hedge against inflation and as a safe-haven investment.
"However, some traders warn that rallies could be viewed as profit-taking opportunities, rather than a move considerably higher."
An immediate response to a change in federal rates can be expected from the dollar, but while the Fed's decision was still anticipated the dollar looked strong against other currencies, helping to keep gold temporarily in check.