US Federal Reserve hiked its near zero interest rates as expected widely by 25 bps on December 16. Adding to that, Fed Chair Yellen prepared markets saying that there would be further gradual hikes in 2016, which would of course be data-dependent.
The central bank's focus is on inflation, which is below its target range but needs to rise. She also referred to USD exchange rate, saying any excessively solid appreciation of greenback could put brakes on rate hike cycle which is now started.
"As far as the gold price was concerned, the Fed's actual interest rate decision was virtually a non-event, it responded only briefly and soon afterwards was back trading at the same level as before the rate hike", noted Commerzbank.
