Gold edges higher ahead of ECB decision, Fed comments support
Investing.com
Published May 02, 2013 03:31AM ET
Prices remained supported after the Federal Reserve re-affirmed its commitment to leave interest rates unchanged near zero and continue buying USD85 billion in debt each month.
Gold can benefit from such an environment of easy money because of expectations that ample liquidity would put a damper on the value of paper currencies.
On the Comex division of the New York Mercantile Exchange, gold futures for June delivery traded at USD1,455.15 a troy ounce during European morning hours, up 0.6% on the day.
Comex gold prices held in a range between USD1,448.25 a troy ounce, the session low and a daily high of USD1,459.85 a troy ounce.
Gold prices were likely to find support at USD1,439.75 a troy ounce, the previous session’s low and near-term resistance at USD1,479.15, the high from April 30.
The Federal Reserve said in a statement Wednesday that it would continue with its USD85 billion monthly bond-buying purchases, but added it may raise or cut the program, subject to economic conditions.
"The Committee is prepared to increase or reduce the pace of its purchases to maintain appropriate policy accommodation as the outlook for the labor market or inflation changes," the Fed statement said.
Moves in the gold price this year have largely tracked shifting expectations as to whether the U.S. central bank would end its bond-buying program sooner-than-expected.
Investors now looked ahead to the outcome of the ECB’s policy meeting later Thursday, as well as Friday’s closely watched report on U.S. nonfarm payrolls.
From a technical standpoint, gold futures are expected to meet strong resistance at the USD1,480-level.
Elsewhere on the Comex, silver for July delivery climbed 1.1% to trade at USD23.60 a troy ounce, while copper for July delivery edged 0.7% higher to trade at USD3.101 a pound.
Copper prices fell to an 18-month low on Wednesday, amid concerns over a slowdown in demand from top consumer China.
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Written By: Investing.com
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