MTECHTIPS:-Gold price up on market speculation

MTECHTIPS:-Gold price up on market speculation

MTECHTIPS- The price of gold settled at $1161.23, an increase of 0.19%, as investors mulled the outcome of this week’s Fed meeting in Washington D.C. The uptick reversed a negative trend for the commodity. The price of silver also increased. A leading gold analyst said this fall’s overall decline is the price of the precious metal is similar to the scenario that played out last year. Back then, gold fell 18%, and then surged 24%. The significant price decline happed before the Fed meeting where interest rates were increased last year, and then the price recovered and gained ground after that. Analysts said the commodity will, based on this historic pattern, likely rally during the next five months. The increase could be by as much as 16%. The rise in prices will continue until the Chinese New Year, which coincides with the commercial peak of production for gold. China is now the world’s leading consumer of gold, the world’s fourth most liquid asset. Inflation will also be a factor for gold. Analysts believe markets are “underestimating inflation” by 30 to 50 basis points. Thus, the mathematical probability of a rally is extremely high, as the consensus is that inflation is going to be higher next year, analysts said.

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