Gold Hits a 12-Month Low as Fed Hike Bets Build
Gold closed Friday at its lowest in 12 months as stock-market losses and December Fed rate-hike bets forced investors to sell bullion. The post Gold Hits a 12-Month Low as Fed Hike Bets Build appeared first on The Rio Times .
Gold prices hit a 12-month low on Friday at US$3,928 an ounce, marking its lowest settlement in at least a year. This decline of 2.00% came after a string of three losing sessions, with the metal currently 28.8% below its record high of US$5,513 set on January 28. The primary reason for this drop was a cash squeeze, triggered by a stock market tumble led by chipmaker Intel, which plummeted nearly 30%.
This market sell-off dragged the S&P 500 down 1.82%, leaving investors who had borrowed to invest scrambling to sell whatever assets were easiest to liquidate.
The Federal Reserve, with interest rates set between 3.75% and 4.00%, has not ruled out a rate hike in December. This possibility, coupled with a prediction market showing a 70% chance of another rate increase this year, makes gold less appealing due to its lack of interest earnings. Silver's price also fell, closing at US$51.94 on Thursday, down 3.66% for the day and 54.7% below its January 28 high.
While no silver price was recorded on Friday, the trend shows silver losing 15.06% over the past 20 sessions, compared to gold's 5.07% decline in the same period.
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