Gold Prices Plummet By 6% As Experts Predict December Interest Rate Hike

The gold market is going through some unusual changes right now. Although there is a surging demand from regions such as India, the overall gold price is crashing hard. In fact, its value dropped by 6% on Thursday and Friday, which is quite surprising. It appears that investors deem precious metals too”risky” to invest in right now.

Gold Value Reaches New Low Since 2013

It has not been a good week for gold bugs all over the world. Prices have dropped by as much as 6% this week, settling at a low of nearly US$1,220 per ounce. That is the lowest price point for this precious metal since 2013. Experts seem to look at Trump’s election victory as the reason for this drop, although it looks like other factors are at play as well.

It was to be expected that investment markets would respond strongly to the US Presidential election outcome. Such a steep downtrend wasn’t planned for gold, though, as the changes took virtually everyone by surprise. Additionally, it is not the first time that gold closes the week a lot lower than it began, even though the gap is a lot bigger this time around.

The bigger question is whether or not this downward trend will continue for gold and precious metals. The Federal Reserve is expected to unveil their plans for the interest rates in December. Depending on the information they will share with the public, the next trend will be either shooting upwards, or plummeting further in the coming months.

One thing is certain, and that is gold is under a lot of pressure. With asset prices on the rise and expectations for increased interest rates, investing in gold is a far less favorable option all of a sudden. In turn, this will affect the price per ounce, as investors may start to pull funds out of their gold savings and put it back into savings accounts.

Despite this temporary setback, the long-term outlook is still looking positive for gold and other precious metals. Financial turmoil is always a driving factor for additional bullion investments. Keeping in mind how the Brexit still has to play out, it is possible that the gold price will surge again before the end of the year.

Investing, whether it is in stocks, bonds, bullion, or even Bitcoin, is always a long-term game. Granted, some people are in the business to scalp profits whenever they can. But for people who want financial stability, such an investment should be looked at quarterly, or even semi-annually.

If you liked this article, follow us on Twitter @themerklenews and make sure to subscribe to our newsletter to receive the latest bitcoin, cryptocurrency, and technology news.