Gold has climbed this morning to a five-week high of a good $1,140 per troy ounce after having already gained by 1.4% yesterday. The price rally was sparked by dovish perceived minutes of the latest Fed meeting at the end of July, which in the eyes of market participants significantly lowered the probability of an interest rate hike by the US Federal Reserve in September. Precious metal prices are being pulled up strongly by a rising gold price. Even before the minutes were published, an only moderate increase in US consumer prices in July had already raised doubts about a Fed rate hike in the coming month. Gold meanwhile is trading close to its March low of $1,142 per troy ounce - it was its fall below this level that triggered the price slump in July to a 5½-year low of $1,077 per troy ounce in the first place. If the price were to rise above this level, follow-up buying would presumably ensue, says Commerzbank. According to Fed Fund Futures, the probability of a rate hike is now only roughly 30%, that is to say it is back at the level it was prior to the hawkish comments made by Fed President Lockhart in early August, when he claimed that there would be high obstacles for him to refrain from voting for a rate hike in September. The Fed minutes have clearly given rise to doubts about whether this is really the majority view within the Fed.

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