The gold market is slightly higher in early action Monday as the markets await several key pieces of economic data. Highlights of the week will include the conclusion of the Federal Reserve meeting Wednesday, the latest non-farm payrolls data due for release Friday and any developments from trade talks taking place in Shanghai.
The Fed is widely expected to cut its key interest rate by 25-basis points at the conclusion of its two-day meeting on Wednesday. Market expectations for a 50-basis point cut had dwindled in recent weeks following a strong June jobs report in which the nation added 224,000 jobs. Although the central bank could potentially cut rates by a half-point, a quarter-point cut is far more likely given recent economic data. Markets have already priced in a quarter-point cut by the Fed and will now turn their focus on the central bank’s plans ahead.
Opinions over the Fed’s next moves-or lack thereof-are all over the map.
Some analysts have suggested that a cut this busy week is simply an “insurance” cut designed to counter the mounting effects of a global slowdown. Other analysts have suggested that this could be the first of a series of rate cuts that could see the Fed Funds rate back at zero.
The non-farm payrolls data could potentially help shape expectations. Estimates are looking for 165,000 jobs added in July, and a sharp miss could potentially pave the way for further action from the Fed. If the report meets or exceeds expectations, however, it could potentially keep the Fed on hold.
Regardless of what the Fed does or does not do, it seems increasingly clear that the current expansion may be nearing its end.
The next great recession is likely approaching, and the central bank may be forced to resort to extraordinary measures in order to combat it. This could mean rates back at zero and more likely another round of QE.
Stocks may see a temporary bump based on the notion of ultra-low rates, but at some point, the house of cards that has become the stock market will come crashing down once again. That makes now the ideal time to diversify with alternative asset classes, and there may be no better asset class to go to than gold.
Gold not only has significant and unlimited upside price potential, but it may also act as an important hedge against a weaker dollar, rising inflation and lower stocks. Adding this key asset class to your portfolio has never been easier, and perhaps never more important.
Speak with an Advantage Gold account executive today about the potential benefits of gold ownership. Our associates are here to answer any questions you may have and can even show you how to build a significant allocation using an IRA account.
Don’t wait for the next major recession and global stock market meltdown before acting. Explore your options for gold ownership today. Call Advantage Gold at 1-800-341-8584 to get started now.Tags: busy week, central bank plans, economic data, global slowdown, gold market, jobs report, market expectations, non-farm payrolls, rate cuts, stock bump