Technical analysis and trading recommendations - https://fxpcm.com/fx/xauusd-fed-does-not-deny-possibility-rate-hike-june-08042016
Yesterday's speech of Fed D.Yellen at a meeting in New York with the participation of former presidents of the Fed was the reason for today's decline in the gold price quotes.
During his speech D.Yellen gave upbeat assessment of the US economy and confirmed that the next step will be the Fed raising interest rates, although the process should be gradual.
This morning, Fed President Kansas City, George, also said that the state of the labor market and other macroeconomic indicators in the US remain strong and delaying rate hikes creates the risk of formation of "bubbles".
On Monday the Federal Reserve Bank of Boston President Eric Rosengren said that "it is reasonable to resume the gradual rise in interest rates earlier than expected in the futures markets."
According to most market participants, in June, the Fed may go for another rate hike in the United States.
And if so, then the price of gold is under pressure before that date if the world political arena or in the financial markets will not happen unforeseen negative events.
For gold, which does not bring interest income and dividends, favorable low interest rates. In the context of the interest rate increase investment attractiveness of gold is reduced in favor of the dollar, because the cost of borrowing for the purchase of gold and its storage is growing.