NEW YORK (Scrap Register): Gold tends to rally after Federal Reserve announcements on interest-rate hikes, so look for the same this week, said Bob Haberkorn, senior commodities broker with RJO Futures.
A two-day meeting of Fed officials ends Wednesday, followed by a press conference by Fed Chair Jerome Powell. Markets have factored in another 25-basis-point rate hike.
“At the beginning of the week, it [gold] will be quiet,” Haberkorn added. “After the Fed, there will be upside in gold. Typically, you can buy gold going into any Fed announcement and it rallies afterward.”
Longer term, he continued, the key will be whether the Fed makes any changes to past language in its communiqué that steered markets toward expecting further monetary tightening.
“What do they say about inflation and rates moving forward?” Haberkorn asked rhetorically.