Gold held an advance at just below $1,200 an ounce on Wednesday before the outcome of the U.S. Federal Reserve’s last policy meeting of the year, when it may signal how soon it will raise interest rates, and slumping energy prices and potential Russian bullion sales.
The investors were also watching to Russia after the ruble collapsed more than 11 percent versus the dollar on Tuesday despite a considerably rise in interest rates by the central bank.
Crude oil prices in lows five years have growing concern that inflation could drop further below the 2 percent target laid down by central bank of the United States, which has kept its key rate near zero since 2008 after leaving incentive in October.
Spot gold was almost flat at $ 1197.20 an ounce after a choppy trade on Tuesday that put at least one week of $ 1188.41, before ending slightly higher.
Gold for February delivery gained 0.3 percent to $ 1,197.70 an ounce on the Comex in New York, after a fifth day of losses, it was the longest losing streak since November 6. Assets in the SPDR Gold Trust, the largest exchange-traded product backed by bullion, product shrank for a second day yesterday.
Fumble this phrase would mean that the Fed is preparing the market for a rate hike next year as the US economy strengthens, analysts say, which would reduce the prices of non-interest assets such as gold .
At the Multi Commodity Exchange, gold for delivery in far-month April was marginally up on global cues by Rs 21 to Rs 27,371 per 10 grams.
Oil prices are tanking. EM currencies were in a free fall. Venezuela was submerged into a financial crisis and Russia had plunged into debt default and devaluation. The year was 1998.
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