However, a $100 drop in gold because the Federal Reserve could potentially raise interest rates by 50 basis points in two years feels to me like an exaggerated move.
After all, gold had already fallen in recent days in anticipation of a possible change in direction on the part of the Fed,” said Commerzbank analyst Carsten Fritsch in a report Thursday.
Interest rates aren’t going anywhere soon, and inflation will continue to rise, and that means real interest rates will remain in historically low negative territory for the foreseeable future.