Hints for Fed interest rate hike could weigh on gold price

Demand for gold coins, remains very robust, especially in the US: according to figures from the U.S. Mint, 161,500 ounces (5 tons) of gold coins have been sold so far in July. This is not nearly enough to offset the ETF outflows, however. Market participants are likely to be focusing their attention on today's meeting of the US Federal Reserve, and will be interested particularly in any indications in the accompanying statement as to when the Fed might begin its interest rate hikes. 

"If a rate hike in September were to be signalled, this would doubtless drive up the US dollar, which would ultimately weigh on the gold price, for the Fed Fund Futures have so far only priced in roughly 40% of a rate hike in September. As soon as the Fed begins raising interest rates, one major uncertainty will be removed for the gold price, thus allowing it to gain", according to Commerzbank.