Gold May Benefit As The Federal Reserve Heads Towards A Pivot Point

Summary

  • This recent drop in inflation presented the FOMC with an opportunity to ‘pause’ its current rate hike policy.
  • The question that we wrestle with is when do they pivot and decide that the interest rate level is as high as it is going to go.
  • A visual inspection of the dollar and gold shows that the dollar peaked in September 2022 and gold bottomed around the same time.
  • Gold has an inverse relationship with the US dollar so it should be the beneficiary of the dollar’s demise.
  • Gold has an inverse relationship with the US Dollar so it should be the beneficiary of the dollar’s demise.

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