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Gold Falls, Other Precious Metals Avoid Losses

May 26, 2016 at 19:46 by Vladimir Vyun

Gold fell today amid continuing speculations about a potential interest rate hike from the Federal Reserve. Surprisingly, gold was the only precious metal to fall while other metals were rising.

Fed Governor Jerome Powell (who is a permanent voter on the monetary policy committee) said that a hike may happen soon. He stated:

If incoming data continue to support those expectations, I would see it as appropriate to continue to gradually raise the federal funds rate. Depending on the incoming data and the evolving risks, another rate increase may be appropriate fairly soon.

He joined the chorus of other Fed members that were talking about monetary tightening in the near future. Yet it looks like markets do not believe in a June hike. The CME FedWatch is an evidence of this as the probability of June tightening shown by the site is falling and now stands at 26% (whereas just recently it was at 40%).

August futures for gold traded 0.29% below the opening at $1,220.2 per troy ounce as of 19:37 GMT on COMEX today. At the same time, July contract for silver went up 0.46% to $16.34 per ounce. Spot price for platinum rose a little by 0.1% to $993.79 per ounce. Palladium soared as much as 1.58% to $542.77 per ounce.

If you have any questions and comments on the commodities today, use the form below to reply.

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