TOKYO -- The gold market's two-year slide on speculation of a U.S. interest rate hike has stopped thanks to short covering in the futures market and buying of the metal as a safe asset after the Federal Reserve finally raised rates last week.
New York gold futures are around $1,075 per troy ounce. U.S. and European funds bought when the market hit bottom Dec. 17, the day after the Fed hiked rates. That day, the price of gold in Shanghai shot up to $1,070, compared with $1,050 in New York. The expansion of the gold premium in Shanghai from the year-to-date average of $3.50 signaled that the metal has stopped declining.
