Gold trades near 8-month low as Fed raises interest rate outlook

Gold rose slightly on Thursday, following its drop the previous session, yet traded near its lowest level in eight months after the Fed raise interest rate hike outlook.

While the Fed kept its pledge to leave interest rates at its record low for some time, it mentioned there would faster progress in raising interest rates once they embark on their first hike. Now, the Fed projects the interest rate to reach 1.375 percent by the end of next year, compared with previous forecasts of 1.125 percent. As for 2016, policymakers foresee a move up to 2.875 percent from June’ prediction of 2.50 percent.

Additionally, the number of Fed members predicting an interest rate hike next year edged up to 14 out of the 17 members, from 12 I three months ago.

The U.S. dollar, in response, traded near its highest level in 14-month on Wednesday,

to add more pressure on all dollar-denominated commodities. The dollar index, which tracks the green currency’s movements versus a basket of six major currencies,

is currently hovering around 84.67 after setting a new high of 84.89.

Today, all eyes will focus on Scotland independence referendum, which is likely to take a toll on currencies, especially the pound.

Meanwhile, gold is trading around $1223.95 after hitting a high of $1224.61 and a low of $1215.90. Crude oil for November’s delivery inched up to trade around $92.92 barrel.