Gold Back Above $1800 As Fed Signals No Change in Interest Rates

Gold futures climbed higher on Friday and are now back above the key $1800 an ounce level amid news that the Federal Reserve will keep rates low for the foreseeable future.

Though Federal Reserve chairman Jerome Powell said Friday morning via a virtual Jackson Hole Symposium that the Fed planned to taper its $120 billion worth of monthly bond buying purchases later this year, he indicated that the Central Bank is still committed to keeping interest rates low. (Story continues below.)

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Record low rates combined with recent inflation data has investors worried that inflation will depress the value of the U.S. dollar. Indeed, inflation in consumer prices jumped 5.4% in the most recent CPI report. Producer prices, which often rise ahead of consumer prices, are currently up 7.8%.

Chairman Powell said these indications showed “progress” on inflation but, were not reason enough to change its interest rate policies as of yet.

By mid-day on Friday, the price of gold was trading at $1817.50, showing a gain of $22.30 or 1.24%. When investors worry about dollar, they tend to move into perceived safe havens investments like gold.

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