1st LD Writethru: Gold up ahead of U.S. Fed's rate hike announcement

Gold futures on the COMEX division of the New York Mercantile Exchange rose Wednesday ahead of the announcement on interest rate hikes from the U.S. Fed's policy-setting Federal Open Market Committee (FOMC).

The most active gold contract for February delivery rose 15.2 U.S. dollars, or 1.43 percent, to settle at 1,076.80 dollars per ounce.

The decision of the FOMC to raise the interest rate by 25 basis points was announced on the gold futures market's close Wednesday after the FOMC ended two days of deliberations in the same day.

In electronic trading Wednesday, however, gold futures fell below 1,070 U.S. dollars following the FOMC's announcement to raise the interest rate for the first time in nine years, paring earlier gains made immediately before the announcement.

A report released by the U.S. Department of Commerce Wednesday prevented the precious metal from rising higher as the report showed housing starts were also very strong, which went up 10.5 percent to hit 1.173 million units, higher than expectations.

On the other hand, the manufacturing Purchasing Managers' Index (PMI) fell to 51.3, the lowest reading in more than three years.

Silver for March delivery rose 47.8 cents, or 3.47 percent, to close at 14.248 dollars per ounce. Platinum for January delivery added 20.2 dollars, or 2.36 percent, to close at 876.00 dollars per ounce. Endit