Learning Investment09 - The price of gold on the Comex
Division of the New York Mercantile Exchange rose of trading on Wednesday
(Thursday morning Jakarta time). The strengthening occurred after the
announcement of the meeting of the Central Bank of the United States (US).
Quoting Xinhua on Thursday
(08/20/2015), the price of the most actively traded gold for December delivery
rose $ 11 or 0.98 percent to US $ 1,127.90 per ounce.
Gold prices rose on speculation
of market participants that it is likely the Fed will not raise interest rates
in the near future.
Earlier, the price of gold which
had been under pressure as analysts predict that the Federal Reserve will soon
raise interest rates in September because the data that is sufficient to
support the economic recovery so that market participants forecast that US
interest rates will soon rise.
The rate hike will push the price
of gold as the precious metal commodities have to contend with financial assets
that have a high yield but the risk is small.
Read also Disappointing US Employment Data, Gold Prices Surge
However, gradually the price of
gold has increased due to employment data released by the US Labor Department
revealed that the consumer price index rose 0.1 percent in July 2015 ago. Those
levels were below analysts' forecasts.
In yesterday's trading, gold
futures prices slumped due to the strengthening housing data are the United States
(US) supported speculation the US Federal Reserve will soon raise interest
rates.
In trading Wednesday
(08/19/2015), the most active gold contract for December delivery fell $ 1.5,
or 0.13 percent, to US $ 1,116.9 per ounce.
The US Commerce Department said
housing sales in July rose to 1.206 million, up 0.2 percent from June, the
highest level since October 2007.
Analysts believe that a real
improvement in the property market may affect the timing of US interest rate
hike, possibly in September.
As a precious metal, gold does
not bear interest. Therefore, rising interest rates will push investors away
from gold and towards assets with return. There are no Fed interest rate hikes
since June 2006.