30.10.2014 - Gold has fallen sharply

The price of gold fell sharply after the Fed statementon monetary policy, which has led to the strengthening of the dollar. Negative for gold was the growth of probability of rate hikes of the Fed in September 2015. Also, Federal Reserve noted the downward pressure of oil prices on inflation. Quantitative easing program, which was launched in September 2012 has been completed. Today, we expect another increase in volatility after the publication of data on US GDP growth in the 3rd quarter. Despite the drop in gold prices, we expect the resumption of buying near the levels 1180-1200 dollars per troy ounce. It is worth recalling that, according to the analyst estimates the average price of ounce of gold production is about $ 1,100, so the downside potential is limited. We maintain a positive medium-term outlook for gold.

The price of Light Sweet crude oil rose yesterday after the publication of data on oil and oil products in the US. Thus, crude oil inventories increased by 2.1 million barrels, or 1.3 million barrels less than analysts' forecasts. Meanwhile, gasoline inventories decreased by 1.2 million barrels compared to the expected 1.0 million barrels. The reason for such dynamics was maintenance of some refineries before switching to the production of winter fuel. It is worth noting that the strengthening of the dollar had a negative impact on the price of oil and stopped its growth. Currently quotes are consolidated near yesterday's levels. Today, the increased volatility will be caused by statistics on GDP growth in the United States. We maintain a medium-term negative outlook on oil.

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