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Gold & Other Precious Metals Weaken After Fed Hikes Rates

December 14, 2016 at 22:09 by Vladimir Vyun

Prices for gold and other precious metals sank today after the Federal Reserve announced an interest rate hike after concluding its two-day meeting. The Fed hiked rates for the first time this year, and it was the first unanimous decision since July.

Such move was anticipated by markets, and what really took the traders’ attention was the boost to the Fed’s dot plot. Now, it shows three quarter-point hikes in 2017, up from two forecasted previously.

Higher interest rates boosted the US dollar and made holding onto non-yielding assets (like commodities) less appealing. Unsurprisingly, that led to a drop of precious metals, including gold.

Contract for delivery of gold in February dropped 1.14% to $1,145.8 per troy ounce as of 21:55 GMT on COMEX today. Silver for delivery in March declined 0.69% to $16.86 per ounce. Spot price for platinum was down 1.21% to $924.14 per ounce. Palladium slid 0.99% to trade at $722.7 per ounce.

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