Although the majority of Australian gold producers' shares are posting gains today, Resolute Mining Limited (ASX: RSG) in particular has stood out with an almost 6% gain.
As well as getting a lift from a rebound in the gold price to US$1,212 an ounce from yesterday's low of US$1,198 an ounce, Resolute's shares also received a boost from the release of a positive announcement regarding its Ravenswood Expansion Project.
This morning the company revealed that the Queensland Department of Environment and Heritage Protection issued a draft amended environmental authority for the recommencement of mining at the Sarsfield open pit.
The miner sees this as an important milestone in the governmental approval process supporting the planned Ravenswood expansion
That project is hugely important to the company and would extend its local operations for a further 13 years.
Furthermore it is expected to increase the average annual gold production to more than 120,000 ounces, with a life-of-mine all-in sustaining cost estimated to be A$1,166 an ounce.
Clearly this is a positive development and I can't say I'm surprised to see its shares rally higher.
If gold prices remain at current levels for the foreseeable future then Ravenswood will prove to be an incredibly valuable asset for Resolute.
But once again it is a big if. Although the gold price has been resistant in the last month or two, I can't help but feel that the long-term direction it will take is downwards.
The Fed may have held rates overnight, but I feel it is inevitable that there will be three or maybe even four rate hikes in the United States this year.
As rates rise this will weigh heavily on the gold price and the shares of leading gold producers like Resolute, Newcrest Mining Limited (ASX: NCM), Northern Star Resources Ltd (ASX: NST), and St Barbara Ltd (ASX: SBM).
So for now I would suggest investors stay clear of the gold miners and look to other areas of the market for gains this year.