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Gold up slightly on weaker U.S. dollar

Xinhua, July 27, 2016 Adjust font size:

Gold futures on the COMEX division of the New York Mercantile Exchange rose on Tuesday as a weaker U.S. dollar gave support to the precious metal.

The most active gold contract for August delivery rose 1.3 U.S. dollars, or 0.10 percent, to settle at 1,320.80 dollars per ounce.

Gold was given support as the U.S. Dollar Index fell by 0.07 percent to 97.19 as of 16:45 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.

The precious metal was put under pressure as a report released on Tuesday by the U.S. Department of Commerce showed new home sales increasing by 3.5 percent to 592,000 units during the month of June, which analysts note is not only better-than-expected, but is also the highest level since February 2008.

Preparation and positioning for ahead of the Federal Open Market Committee meeting announcement on Tuesday also put pressure on gold. Traders believe that the Fed will delay the previously expected July interest rate increase until 2017. Previous Fed minutes led traders to believe that the Fed may raise rates from 0.50 to 0.75 during the December FOMC meeting.

Traders are expecting the durable goods orders report to be released on Wednesday along with the Federal Open Market Committee announcement. Thursday will have the international trade in goods report, as well as the weekly jobless claims, and Friday will see the release of the gross domestic product report.

Silver for September delivery added 3.6 cents, or 0.18 percent, to close at 19.683 dollars per ounce. Platinum for October delivery rose 10.6 dollars, or 0.97 percent, to close at 1,099.00 dollars per ounce. Endit