Gold hit yet another record high this week, surging to just past US$2,580 per ounce on Friday (September 13).
It was pushed up by rising expectations that the US Federal Reserve will cut interest rates by 50 basis points next week.
The gold price tends to fare better when rates are low, and earlier in the year sector participants were looking toward the Fed’s first cut as a potential positive catalyst for the yellow metal. However, gold’s substantial rise ahead of any decrease in rates has raised questions about what will happen to its price after the central bank’s gathering next week.
In an interview with the Investing News Network, John Reade of the World Gold Council spoke about where gold is in the current cycle given those circumstances, saying the situation is somewhat unusual.
“Coming up to what is widely expected to be the start of a US rate-cutting cycle, ironically you could actually say that gold is early in the cycle. Gold typically performs pretty well when rates are cut, and if those rate cuts lead to weakness in the US dollar, which they certainly might, that could be a double tail wind helping the metal from here,” he explained.
Reade added, “So this cycle’s been quite different, and that makes answering (the) question quite tricky.”
AngloGold CEO Alberto Calderon said the acquisition comes after several years spent putting the company’s affairs in order. It is now ready to add more “Tier 1” assets like Centamin’s Sukari gold mine in Egypt to its portfolio.
Putin added that such measures don’t need to be taken “tomorrow,” and emphasized that the country should avoid causing harm to itself, but his comments still made waves in the industries he mentioned — especially uranium.
For now it remains to be seen whether Putin’s suggestion will become reality.
Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
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