Fed Hikes Rate, Gold Reacts with $20 Price Surge

In what can only be considered the first quarter’s most uncontroversial and widely expected financial move, Fed Chair Janet Yellen announced a raise in the overnight funds rate this afternoon (March 15) to a target range of 0.75 percent to 1 percent. Minneapolis Fed President Neel Kashkari was the sole “no” vote.
Gold Price Flouts
Virtually boring in its impact, the Fed move has been characterized in a CNBC interview by bond king Bill Gross of Janus Capital Growth as a part of “the old usual” economy rather than “the new normal economy.”
 
State Street Global Advisors chief investment strategist Michael Arone claimed the market interpreted the Fed decision as a sign of relief. He said it “was bracing for a much more hawkish tone from the Fed.” And now that the market has accommodated this news, the Federal Open Market Committee (FOMC) has efficiently prepped the nation for two more rate hikes by the end of the year.
 
But clearly the unheralded financial superstar of the Ides of March was gold. On a simple dollar correction, the yellow metal bolted $20.00 on the COMEX for the day’s close at $1,219 per ounce. A weaker dollar always provides a shot of steroids for gold.
 
In fact, Peter Spina, President of GoldSeek.com, views the spike in the shiny metal as a defensive accommodation for future inflation, a phenomenon Fed Chair Yellen said the FOMC sees down the road. And if the market senses inflation will move faster than the Fed says it will, Spina predicts gold will climb to the $1,400-1,500 level later this year.
 
For all the Fed’s manageable predictions, the possibility remains that President Trump’s development plans for the country, with congressional support, could become the nation’s principal economic stimulus, in which case, gold could easily soar beyond $1,500. That kind of government spending will ignite inflation.
 
Doesn’t it make sense, then, for you to add some physical gold to your portfolio at its current price? It’s the best financial insurance you could possibly buy in the current economy.
 
Request more information now or call 800-777-6177 now, and ask to speak to a Fortress Gold Group representative.

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