Gold gives way before the ECB rate decision

Gold gives up part of its yesterday’s profits on Thursday morning in the run-up to today’s interest rate decision by the European Central Bank (ECB). From the high of 1,950.83 US dollars per troy ounce, the precious metal has so far fallen back to 1,941.70 US dollars per ounce.

The focus is on the ECB Council meeting. Both the interest rate decision at 1:45 p.m. CEST and the subsequent press conference with ECB boss Christine Lagarde from 2:30 p.m. CEST are eagerly awaited. The Helaba analysts do not expect an interest rate cut, “because the ECB representatives have repeatedly emphasized in the past that fiscal policy is more important in combating the crisis.

The major EU support programs are only just starting and so, in our opinion, it would not be helpful to increase interest rates again. There is probably no urgent need for action on the bond purchases either. The funds have not yet been exhausted and an early commitment to more could take the pressure off fiscal policy to act, ”wrote the Helaba analysts in the current“ Daily Outlook ”.Attention will be paid to further possible comments from Lagarde on the high euro at the press conference. ECB chief economist Philip Lane had been critical of the strong euro appreciation in recent months. “The EUR / USD rate plays a role,” said Lane. The movements in the EUR / USD rate feed into the forecasts of the ECB and are also reflected in its monetary policy, it said.

Around 10:25 a.m. CEST, gold was down 0.11 percent at $ 1,944.28 a troy ounce.