Daily Market Roundup: Global glut in oil to remain; Gold to rise after Fed lift-off?

Nick Batsford, CEO of Tip TV, was alongside Richard Hunter, Head of Equities for Hargreaves Lansdown, when he opened the Tip TV Finance Show on the 14th December 2015 to discuss the current situation with oil, as well as the Fed rate hike and the outcome of this on gold.

OPEC maintaining production doesn’t reduce global glut

Hunter outlined that the decision at the recent OPEC meeting to maintain production at current levels will mean that the oversupply of oil into the market will remain. He added that with oil now around $40 a barrel and with the possibility for it to continue lower, further exploration and production must begin to be questioned by oil companies.

Will gold see upside with a Fed hike?

Batsford highlighted FX Street, who noted previous yeas when the Federal Reserve followed a tightening policy, and the consequent reaction on gold. As history shows, they continued that gold could repeat history and rise after lift-off this Wednesday if the Fed do as the market expects and hike rates. Hunter added that this is not an environment where interest rates will usually be hiked, but on the other hand, the US economy seems to be strong enough to deem a small interest rate rise.

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