Quote on Gold by Rajeev Sharan, Head - Criteria, Model Development & Research - Brickwork Ratings
Below the Quote on Gold by Rajeev Sharan, Head - Criteria, Model Development & Research - Brickwork Ratings
"Gold prices are likely to stay under pressure over the next two weeks. At home, healthy FCNR(B) deposit inflows have helped the rupee stay strong, and a stronger rupee usually keeps local gold prices in check even when global prices hold steady. The bigger factor is the US Federal Reserve, which will announce its rate decision on September 16. After Chair Kevin Warsh struck a hawkish tone at Jackson Hole, the market is now almost evenly divided on whether the Fed will raise rates by a quarter point or hold them at the current 3.50 to 3.75%. Any hike, or even a hawkish hold, would lift US Treasury yields and pull money toward these safer, higher paying bonds, making gold less attractive since it pays no interest. So, we expect gold to stay soft, though a softer signal from the Fed could quickly turn things around."
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