It is highly likely that the Federal Reserve will impose a 75-point rate hike in September as it proceeds with its attempts to drive down inflation, according to the CME FedWatch tool. Its reading now gives a 68.5% probability that a supersized hike will take place, up from a probability of just 47.4% before last week’s Jackson Hole summit.
This expectation has markets jittery and, with sell offs, has created an opportunity to buy gold at a discounted rate for those who move fast. The small window to buy comes as the precious metal begins the day’s trading around 0.09% lower at £1,471 ($1,716).
In trading earlier this week, those rushing to buy the dip pushed gold prices higher after a lull, meaning that fast action is crucial to obtaining the best possible price point.
Friday’s Jackson Hole symposium concluded with chairman Jerome Powell asserting that tightening will continue “to get the job done”, meaning additional rate increases will also be on the way. This is significant as the U.S. economy has technically already entered a recession. Further pressure from the Feds will almost certainly inflict more economic pain, making now a smart time to add a solid, steady, reliable asset such as gold to your portfolio.
