This Week in Gold: Interest Rates, Fed Meeting, Scotland Decides


This week in gold, we saw a few interesting events unfold that each had an influence on gold, such as the latest Federal Reserve statement and the Scottish independence referendum. We also took a look at gold’s controversial relationship with interest rates and how the world’s nations rank in terms of gold holdings and production. With so much speculation over where the gold price may go, it’s important not to lose sight of what gold provides in the present: tangibility, inherent value, and real protection.

5 Reasons for Gold’s Recent Fall in Price

Why has gold been hitting lows recently? The answer is multi-faceted, but simply put, investors are forced to weigh different factors against each other and make decisions based on which ones they believe are the most salient to them at the time. How heavily or lightly they decide to weigh each factor is much of what drives the gold price. See which five of of them in particular have been receiving a great deal of attention and making waves in the markets this past week. 

What You Need to Know about Gold and Interest Rates

Interest rates affect many markets, whether it be stocks, bonds, mutual funds, currencies, etc. Their relationship with gold, however, is more complex and controversial. In Tuesday’s blog we laid out what we believe gold buyers should know about the relationship between gold and interest rates, and how popular opinion on the issue is not necessarily true. Despite what you may have heard, gold can thrive in an environment of higher, rising interest rates, and it has done so several times in the past.

Gold: How the World Stacks Up

Ever wondered which countries hold the most gold? What about gold production? Organizations such as the International Monetary Fund, the World Gold Council, and the U.S. Geological Survey produce data every year that helps us determine the answers to these questions. Even some of the world’s largest nations are not immune to the devaluation of currencies and have prepared accordingly by investing in gold as a hedge. Why shouldn’t you, as a private citizen, do the same? Read more in Wednesday’s blog.

Gold Feels Effects of Fed Statement and Scottish Independence Referendum

Gold fell and then stabilized on Wednesday afternoon as the Federal Reserve released a policy statement upholding its plans to keep interest rates near zero for a “considerable time”. In addition, gold bugs overseas faced uncertainty over a possible vote in favor of Scottish independence from the United Kingdom and the economic implications this could have had in the region. Although the referendum was voted down and Scotland remains a part of the UK, many Scots were well-prepared with plenty of gold had the vote gone the other way.

Many Scots apparently believe in the protective benefits of gold in the face of economic uncertainty. Do you? Gold can be your safe haven from government policy that is out of your control and may have implications for your personal finances. Consider adding physical gold to your retirement portfolio for security and diversification. Call American Bullion today at 1-800-326-9598 and ask about rolling over your current IRA or former 401(k) to a Gold IRA holding physical gold and other precious metals.