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Gold Price Drops as China Hikes YuanPosted on: 19th October 2010 By Anita
Wow it’s been an exciting time in the markets overnight! The big news today is that the People’s Bank of China announced a surprise .25 rate hike. This sent the US dollar surging and gold plunging. The .25 rate hike is in many ways not that much, however it’s signaling the start of further and more aggressive tightening cycle.
The implications are a stronger USD, weaker commodity prices (gold and silver) and lower equities (stocks, shares, etc). There’s also the possibility that gold drops some more and then bonces back to previous levels – however calling moves like this are akin to gambling – risky and very hard to call correctly.
At Gold Smart we’ve been saying to our customers for sometime that gold has been due for a pull-back so congratulations to those that took action and benefited from their good timing!
Gold prices are still very good from a historical perspective, so if you are considering selling gold – give the friendly team at Gold Smart a call to discuss now – 0800 465 376
As Gold Buyers we will be doing our best to hold our high rates, however if there’s further movement on the downside, we won’t be able to hold them for long!