GOLD TRADERS ARE WAITING FOR THE FED’S STATEMENT TONIGHT
The price of gold corrected upwards on the background of profit taking and fixing positions before today’s statement by the Fed on monetary policy at 18:00 GMT and the press-conference of Janet Yellen at 18:30 GMT. Most traders are expecting the rate hike and this scenario is already priced in but the hints about future plans concerning tightening of monetary policy may lead to sharp moves of the bullion price. Slight fluctuations today are also possible after the reports on the consumer price index in the US at 12:30 GMT and business inventories in America at 14:00 GMT.
We should mention that inflation is a key indicator for the Fed, which has a large influence on future decisions about the timing of the next rate hikes. Getting close to the target level of 2.0% will force the central bank in the US to accelerate the pace of monetary policy normalization. Overcoming the resistance at 1270, after the recent price exit from the local downward channel, may become a strong signal for further growth to 1280 and 1287. Today the closest support levels in case of decline will be 1265 and 1260.