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Gold Ends Higher Ahead Of Fed Minutes

July 9, 2014

WASHINGTON (Alliance News) - Gold futures snapped a three-day loss to end higher on Wednesday, ahead of the minutes of US Federal Reserve's June policy meet due later today, even as some weak global equity markets prompted investors to seek the safe haven of the precious metal.

Investors await the minutes of the Fed's June policy meet for indicators to its monetary policy, with the central bank widely expected to stick to its dovish stance on concerns over slow inflation growth in the US

It also remains to be seen if the Fed would bring forward its timetable for raising interest rates notwithstanding some concerns over the current economic growth.

Gold for August delivery, the most actively traded contract, gained USD7.80 to close at USD1,324.30 an ounce on the Comex division of the New York Mercantile Exchange on Wednesday.

Gold for August delivery scaled an intraday high of USD1,328.30 and a low of USD1,318.70 an ounce.

On Tuesday, gold futures ended lower for a third session with some weak economic data from the eurozone supporting the yellow metal. Nonetheless, the gains were offset by some recent upbeat US economic data indicating possibilities of a rate hike by the Federal Reserve sometime soon.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, edged up to 800.28 tons on Wednesday from its previous close of 798.19 tons on Tuesday.

The dollar index, which tracks the US unit against six major currencies, traded at 80.12 on Wednesday, down from its previous close of 80.17 late Tuesday in North American trade. The dollar scaled a high of 80.23 intraday and a low of 80.02.

The euro traded higher against the dollar at USD1.3625 on Wednesday, as compared to its previous close of USD1.3612 late Tuesday in North American trade. The euro scaled a high of USD1.3643 intraday and a low of USD1.3604.

In economic news, Chinese consumer prices inflation slowed in June from a 4-month high, as food prices increased at a slower rate, a report from the National Bureau of Statistics showed Wednesday. Nevertheless, the increase was slightly below the consensus estimate.

Consumer prices increased 2.3% year-on-year in June following the 2.5% increase in May. Economists had expected prices to rise 2.4%.

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Source: Alliance News

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