Gold Prices and Terrorism With the Federal Reserve set to review interest rates next month, the price of gold may very well drop if they increase it. But with the current prevalence of terrorism and insecurity, is the price of gold likely to be affected (increase/decrease)?
Very unlikely. Terrorism events are not economically significant enough to move a commodity like gold.  In fact, terrorist attacks only effect markets if they are likely to lead to a major economy entering a full-scale war like it was after 9/11, 2001. The cost of terrorism, while at historical height, is still very small to effect the markets significantly: http://fortune.com/2015/11/17/terrorism-global-economic-cost/. Even economy of a country like France that have been recently hit by a terrorist attack is not likely to be affected by it too much. Politicians may exploit the terrorist attack to push their agenda though, which may have negative effects on the economy, like this articles argues: http://www.marketwatch.com/story/frances-real-challenge-is-growing-stagnant-economy-not-fighting-in-syria-2015-11-19.

Yet, gold is a very volatile market and the price of gold can move a lot in any direction for no obvious reason. Purchases and sales of gold by central banks and institutional investors often go unannounced.

Another thing you should keep in mind if you want to speculate on the rate hike is that some big players may be waiting for that moment to BUY gold in large amounts, because that is when they can expect the most people placing sell orders. In that case the price of gold can jump contrary to expectations.