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Gold lower slightly ahead of FOMC minutes

Xinhua, May 19, 2016 Adjust font size:

Gold futures on the COMEX division of the New York Mercantile Exchange fell on Wednesday as the U.S. dollar strengthened.

The most active gold contract for June delivery fell 2.50 U.S. dollars, or 0.20 percent, to settle at 1,274.40 dollars per ounce.

Gold futures were tracking narrow moves in the U.S. dollar and equities on Wednesday, but settled a little lower as the U.S. Dollar Index rose by 0.37 percent to 94.91 as of 18:15 GMT. The index is a measure of the dollar against a basket of major currencies. Gold and the dollar typically move in opposite directions, which means if the dollar goes up, gold futures will fall as gold, measured by the dollar, becomes more expensive for investors.

However, the precious metal was given support as the U.S. Dow Jones Industrial Average fell by 20 points, or 0.12 percent as of 18:10 GMT. Analysts noted that when equities post losses, the precious metal usually goes up, as investors are looking for a safe haven, while the opposite is true when U.S. equities post gains.

Traders are carefully watching the Federal Reserve's Federal Open Market Committee (FOMC) meeting minutes for hints on when the U.S. central bank would raise its key interest rate, but the minutes are not due to be released until after the market' s close. Investors are also waiting for the weekly jobless claims and Philadelphia Fed Business Outlook Survey on Thursday, and existing home sales report on Friday.

According to the CMEGroup's Fedwatch tool, the current implied probability of a hike from 0.50 to 0.75 is at 51 percent at the July 2016 meeting, and 66 percent at the September 2016 meeting.

Silver for July delivery fell 11.80 cents, or 0.68 percent, to close at 17.132 dollars per ounce. Platinum for July delivery dropped 12 dollars, or 1.14 percent, to close at 1,042.50 dollars per ounce. Endit