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Gold Prices Fall After Fed Decision; U.S. Dollar Also Slips

Published 12/20/2018, 01:24 AM
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Investing.com - Gold prices fell while the U.S. dollar also slipped on Thursday in Asia after the U.S. Federal Reserve raised rates as expected.

COMEX's benchmark February gold futures were down $7.45, or 0.6%, to $1,248.95 per troy ounce by 1:15 AM ET (06:15 GMT).

Futures of the yellow metal hit a six-month high at $1,262.10 on Wednesday before retreating on the Fed's announcement of a fourth quarter-point hike in interest rates this year.

The central bank took the target range for its benchmark fund rate to 2.25-2.5% on Wednesday while forecasting fewer rate increases in 2019 than it had at its September policy meeting.

The interest-rate outlook for both 2020 and 2021 was lowered to 3.1% from 3.4%, which guides to one hike that year.

The longer run interest rate was also cut to 2.8% from 3.0%.

U.S. stocks stumbled up and down after the decision then ultimately closed sharply lower after Powell’s news conference.

"The Committee judges that some further gradual increases in the target range for the federal funds rate will be consistent with sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee's symmetric 2% objective over the medium term," the Fed said in a statement.

Meanwhile, The U.S. Dollar Index that tracks the greenback against a basket of other currencies slipped 0.1% to 96.393.

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