Why the global gold price is ‘very much down’
Gold futures fell as much as 3.2% Tuesday after the U.S. central bank raised interest rates and lowered its key benchmark rate for the first time in four months.
The move comes as investors brace for more supply from emerging markets as the global supply of gold continues to shrink.
Gold prices fell as low as $1,200 an ounce Tuesday on concerns that rising demand from emerging economies could have a significant impact on the global price of gold.
The drop is due in part to concerns about rising demand for gold from emerging market nations as the U., the world’s second-largest gold producer, begins a three-month-long supply reduction program that is set to begin this week.
Gold futures fell 3.6% to $1.2224 an ounce at 8:30 a.m.
ET in New York.
The price has tumbled about 6% this year.
Gold is a precious metal used in jewelry and other items.
It has gained over 40% in value over the last decade.
It trades at about $1:8,500 an ounce in the United States.