The focus of investors in gold and many markets is the US Federal Reserve’s (FED) interest rate hike this week. The decisions of the FED generally affect the markets, but the expectation of an interest rate hike this time has been in the focus of people for a long time. For this reason, some argue that the development in question will not create a change. Gold and Money Markets Specialist, İslam Memiş, thinks that the precious metal may be sold. Here are the details…
Eyes on the FED interest rate meeting: What will happen?
After Russia’s attempt to invade Ukraine, Russia faced sanctions while gold prices reached levels not seen for a long time. Cryptocurrencies, which are seen as relatively risky, such as Bitcoin, experienced a decline. On the other hand, February inflation data in the USA pointed to 7.9 percent, the highest level of the last 40 years. This situation strengthened the thoughts that a rate hike would be made.
On the subject of gold, İslam Memiş pointed out that “during the Fed’s rate hike, there will inevitably be short-term sales in commodity prices”. “When we look at the gram gold, it can be supported by the dollar rate and the decreases may be limited. Gram gold may continue its downtrend in February,” he said.
Will there be decreases in gold price?
Islam Memiş argues that after the rise of gold and dollar, it should technically correct. According to Memiş, who states that he advises investors that they can wait patiently, purchases can be made at cheaper costs. Noting that there is a high cost of more than 900 lira under gram and 1.900 lira under ounce, Memiş mentions that there may be gradual decreases in gold. As support levels, the expert names 920 liras per gram and 1,960 dollars per ounce.
On the other hand, Zeal LLC founder Adam Hamilton stated that “gold has come out stronger from 6 of 12 interest rate hike cycles since 1971” for the Fed rate decision, and that the interest rate hike triggered the exit from the stock markets. and expects this to support gold. Time will tell if Bitcoin will move positively if gold rises. As Cryptokoin.com reported, this week, the CBRT’s interest rate decision will be announced.
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