empty
 
 
cn
支持
即时开户
交易平台
入金/出金

03.11.202109:07 Forex Analysis & Reviews: Expert says not to rush to sell gold and silver

Long-term review

Exchange Rates 03.11.2021 analysis

The Fed is one step away from changing its monetary policy. In case the regulator adopts a hawkish stance today, the precious metals market is likely to turn bearish. At the same time, experts say this is going to be a short-term fall.

The current week has been busy for traders. The market is now solely focused on the long-awaited event - the Fed's monetary policy meeting.

The 2-day FOMC meeting opened yesterday. Many investors and analysts suggest that the central bank will announce the terms of a slowdown in the pace of monthly asset purchases today.

The regulator is also expected to give some clues about interest rate hikes that are set to begin next year.

Yesterday, the US dollar index soared by 0.2% on expectations that the Federal Reserve would finally begin policy tightening.

A stronger greenback and the possibility of tapering have had a negative impact on the precious metals market. On Tuesday, gold closed at $1,789.40, down by 0.4%, or $6.40, from the previous day when the asset gained 0.7%.

Exchange Rates 03.11.2021 analysis

Silver also lost some of its earlier gains on Tuesday, tumbling by 2.4%, or $0.57, and closing at $23.507 per ounce.

Exchange Rates 03.11.2021 analysis

Both precious metals are facing pressure today amid concerns about a hawkish Federal Reserve. At the moment of writing, gold dropped by 0.42%, or $7.45, to $1,782, and silver fell by 0.17% to $23.468.

Meanwhile, analysts suggest that the precious metals will unlikely reverse until the end of the meeting. On top of that, they are inclined to believe that both gold and silver will collapse if the US regulator announces tapering.

At the same time, experts point out that this is going to be a short-term fall and expect the quotes to rise relatively soon because a shift in the Fed's monetary policy will not be enough to stop the inflationary pressure.

Investment Strategist Robert Minter believes that monetary policy tightening will unlikely solve the global supply chains issue. Amid a decrease in global supply, inflation will continue growing, which could lead to stagflation.

Investors are not completely sure that stagflation would be the likely outcome. However, things could change drastically at any moment. Therefore, the expert does not rule out such a possibility.

Growing prices and stagflation concerns are considered positive factors for safe-haven gold by Minter who reckons that it is just a matter of time until investors turn to the asset to protect their capital.

Taking into account the actual return, gold should now trade at around $1,900 instead of hovering around $1,800. The expert considers the precious metal to be undervalued and says that traders should not sell gold until the Fed finds a way to get rid of a $28 trillion government debt.

Minter is also optimistic about silver and expects the precious metal to take advantage of the green energy revolution.

According to the strategist, the global transition to renewable energy will continue to drive demand for copper and aluminum. Likewise, demand for silver, as an important industrial metal, will also increase.

lena Ivannitskaya,
Analytical expert of InstaSpot
© 2007-2024
立即从分析师的建议受益
充值交易账户
开设交易账户

InstaSpot分析评论将让您充分了解市场趋势! 作为InstaSpot的客户,您将获得大量的免费服务以实现有效的交易。

现在无法通话?
提出您的问题,用 在线帮助.