Investing.com - The price of Gold dropped once again on Wednesday, as widespread expectation of an interest-rate increase by the Federal Reserve in December dampened the metal's short-term outlook.
The price for the commodity was down on intraday trading by 1.1% at $1,175.40 an ounce on the COMEX division of the New York Mercantile Exchange.The price ended the day at 1174.80, or 1.34% down. That was a change of 16.00.
Investors reckon the Federal Reserve will raise interest rates at a meeting next month, and the odds of a rate increase is now at 94%, according to Fed fund futures tracked by the CME. Since gold doesn't bear interest, it works hard to compete when interest rates climb. Thus, the price of gold is expected to remain weak in the coming month.
What is more, investors are also looking ahead to the Italian referendum this weekend, when the country will head to the polls to vote on a Constitutional reform. A “no” vote could be a sign of further political uncertainty and increase prices.
Meanwhile, gold demand in India, one of the globe's biggest buyers of the metal, is declining, with gold traders saying imports could fall to just a combined 60-70 tons over the next two months, noted Commmerzbank AG in a note to investors.