Precious metals rose
Gold futures for December delivery trading on COMEX, the commodity division of NYMEX, rose on Wednesday. They touched a high of $1,183.10 per ounce. It’s the highest level in about a week. The futures closed 0.88% higher than the previous day’s close. All of the precious metals saw an up day on Wednesday as the FOMC (Federal Open Market Committee) policy-setting meeting came to an end.
Silver futures rose 2.70% and entered the $16 territory once again. It settled at ~$16.30 per ounce. Platinum and palladium futures also closed positive. They rose 2.40% and 1.10%, respectively.
The above chart for gold shows a reasonably good rising and falling movement on October 28, 2015.
Less dovish stance
Experts and most traders were expecting a “dovish” stance from the October meeting. However, the outcome was a bit on the “hawkish” side. The committee decided to keep interest rates close to zero. It also indicated in its statement that in its next meeting in mid-December it would focus on whether to raise the rates. Before there was any news from the Fed, gold rose almost $10. Shortly after the news, gold fell sharply to $1,162 per ounce.
The CME Group is now showing investors pricing a 47% chance of a rate increase at the December meeting. Investors will likely keep a close watch on the upcoming data from the US so that they can decipher the Fed’s next move.
Gold-backed ETFs like the SPDR Gold Shares ETF (GLD) and the iShares Gold Trust ETF (IAU) both lost 0.8% on Wednesday. Most mining companies also ended the day on a negative note. Companies like Gold Fields (GFI), Aurico Gold (AUQ), and Sibanye Gold (SBGL) lost 5.70%, 2.80%, and 1.60%, respectively. Together, these three companies account for 7% of the price changes in the VanEck Vectors Gold Miners ETF (GDX). GDX witnessed a fall of 0.94% on October 28.