Fed Hikes Rates, Gold Holds Steady Amid Shift in Mining Conference Focus

The Federal Reserve raised interest rates by 25 basis points to 3.75-4.00%, its first increase since 2023, in a unanimous 12-0 vote.

Samuel Pelaez and Derek Macpherson of Olive Resource Capital said the market had already priced in this move, with gold's price action being 'muted'. They attribute this to gold's historical correlation with real interest rates, not nominal rates.

The pair noted that even though the Fed hiked rates, it doesn't change their long-term bullish thesis on precious metals. They believe persistent negative real rates continue to erode the case for holding cash relative to gold.

Pelaez and Macpherson are now focused on identifying which funded companies can convert capital into news flow at this year's mining conferences, particularly in copper, where they're looking for a new story to replace Arizona Sonoran Copper.