Gold prices maintained a steady range in trading on Thursday, 29th November, as they still rallied from the gains made on Wednesday. Gold futures for February were down by $0.7, as they reached the level of $1,229.1 per ounce. Silver also went down by a slight percent, as it reached levels of $14.38 per ounce.
The day’s session also saw traders being updated with the policy discussion of the Federal Open Market Committee (FOMC), as minutes from the Federal Reserve session were released during the afternoon. The minutes revealed that all FOMC members were rather unanimous in voting for another United States interest rate. The minutes also corroborated the statement from Jerome Powell’s speech yesterday that there are chances of a few more rate increases during the next year.
“Participants also commented on how the Committee’s communications in its post-meeting statement might need to be revised at coming meetings, particularly the language referring to the Committee’s expectations for ‘further gradual increases’ in the target range for the federal funds rates,” the minutes mentioned.
“Many participants indicated that it might be appropriate at some upcoming meetings to begin to transition to statement language that placed greater emphasis on the evaluation of incoming data in assessing the economic and policy outlook; such a change would help to convey the Committee’s flexible approach in responding to changing economic circumstances,” was further mentioned in the minutes.
The Federal Reserve of America has used ‘the further gradual rate increases’ as an appropriate method to keep track on their current recovery pattern. Jerome Powell, the head of the Fed, created hysteria in the market by giving a statement that rates are below the neutral level. This almost crashed the market, as the dollar dipped down during the day.
“You saw a pretty massive repricing yesterday of Fed expectations and the dollar and markets may have overreacted a little bit to it,” said Erik Nelson, who is a currency strategist at Wells Fargo in New York currently. “The room for downward repricing in Fed expectations from here may be kind of limited.”
China Hoping for Positive Results
The weekend of the G20 meeting has arrived, and Chinese officials are hoping for positive results from the session in general, and the much talked-about meeting with President Trump later on. Xi Jinping, the Chinese President, is leading their contingent and will be the chief representative, as both the countries discuss issues related to the trade war and their interests in it.
Gao Fen, a spokesman for the ministry, recently spoke to media and mentioned, “I hope that the United States and China could move towards each other and work hard to achieve positive results in the meeting.”
“The Chinese side has repeatedly stressed that the essence of Sino-U.S. economic and trade cooperation is about mutual benefit and win-win,” Gao said further.
White House officials also reaffirmed this week that Donald Trump would be open to dealing with Xi Jinping, when the two meet later this month.