Logo of Phnom Penh Post newspaper Phnom Penh Post - How is rate-hike bolstered dollar affecting gold?

How is rate-hike bolstered dollar affecting gold?

Content image - Phnom Penh Post
Long Samnang, business manager at PPLS

How is rate-hike bolstered dollar affecting gold?

The price of gold has seen a series of declines since August, from around $1,808 to $1,688 per ounce, mostly influenced by the US dollar receiving support from Federal Reserve interest rate hikes.

Supported by a strong US economy still creating jobs, Reuters’ Hari Kishan reported, the Fed has stepped up its fight against inflation by raising interest rates faster than most other central banks.

“That has helped the dollar turn in one of its best performances in at least a decade.

“The dollar index, which was up around 15 per cent for the year, touched a fresh two-decade high of 110.55 on Tuesday.

“With most outcomes like higher interest rate differentials and safe haven moves expected to favour the dollar, the currency is likely to remain strong for longer,” Kishan said.

The current US dollar exchange rate is 2.5 per cent.

Fed Chairman Jerome Powell said at the recent Jackson Hole Economic Symposium that the US central bank would continue to raise interest rates.

The next Fed meeting on interest rates is to be held on September 21.

Based on these fundamentals, PP Link Securities business manager Long Samnang said: “The Fed will raise the interest rate further by 0.50 to 0.75 per cent.

“With such a high possibility of an interest rate hike, the price of gold will fall from its current $1,696 to $1,656 per ounce.”

However, Samnang remained optimistic.

“Compared to the global economy, the price of the yellow metal will rebound after the Fed raises interest rates.”

For this week’s trading recommendation, market analyst Samnang recommends investors to remain patient and buy gold at between $1,660 to $1,656 per ounce.

Content image - Phnom Penh Post


  • Wing Bank opens new branch in front of Orkide The Royal along Street 2004

    Wing Bank celebrates first anniversary as commercial bank with launch of brand-new branch. One year since officially launching with a commercial banking licence, Wing Bank on March 14 launched a new branch in front of Orkide The Royal along Street 2004. The launch was presided over by

  • Girl from Stung Meanchey dump now college grad living in Australia

    After finishing her foundational studies at Trinity College and earning a Bachelor’s degree from the University of Melbourne in 2022, Ron Sophy, a girl who once lived at the Stung Meanchey garbage dump and scavenged for things to sell, is now working at a private

  • Ministry using ChatGPT AI to ‘ease workload’; Khmer version planned

    The Digital Government Committee is planning to make a Khmer language version of popular artificial intelligence (AI) technology ChatGPT available to the public in the near future, following extensive testing. On March 9, the Ministry of Post and Telecommunications revealed that it has been using the

  • Wat Phnom hornbills attract tourists, locals

    Thanks to the arrival of a friendly flock of great hornbills, Hour Rithy, a former aviculturist – or raiser of birds – in Kratie province turned Phnom Penh tuk tuk driver, has seen a partial return to his former profession. He has become something of a guide

  • PM urges end to ‘baseless’ international Ream base accusations

    Prime Minister Hun Sen urges an end to “baseless” foreign accusations surrounding the development of the Kingdom’s Ream Naval Base, as the US has consistently suggested that the base is being expanded to accommodate a Chinese military presence. Hun Sen renewed his calls while

  • Almost 9K tourists see equinox sunrise at Angkor Wat

    Nearly 9,000 visitors – including 2,226 international tourists – gathered at Angkor Wat on March 21 to view the spring equinox sunrise, according to a senior official of the Siem Reap provinical tourism department. Ngov Seng Kak, director of the department, said a total of 8,726 people visited Angkor Wat to