Gold has rallied to a two-year peak after the Federal Reserve indicated it may wait longer to raise interest rates. Bobbi Rebell reports.
Gold is on the go. The precious metal climbing to a two-year high, trading above $1300 an ounce after the U.S. central bank said slower economic growth would crimp the pace of tightening in future years. Concerns about Britain leaving the European Union are also a major concern for investors who are flocking to the safe haven. Peter Cardillo Chief Market Economist at First Standard Financial (SOUNDBITE) PETER CARDILLO, CHIEF MARKET ECONOMIST, FIRST STANDARD FINANCIAL, (ENGLISH) SAYING: "I suspect that we are probably going to move a bit higher before the referendum vote next week, and, if they should elect to depart from the EU, I think, we could see gold get close to $1500. " Gold is sensitive to interest rates, because higher rates increase the opportunity cost of holding the precious metal. If rates are lower, and there are concerns about global economies, that increases the attraction of safe haven assets like gold. The latest rally in gold was sparked by the May jobs data which showed an increase of only 38,000 jobs in the month, far short of expectations.