Gold futures tick higher ahead of Fed outcome
Investing.com
Published Apr 27, 2016 02:51AM ET
Gold rises before Fed rate decision
Investing.com - Gold futures ticked higher in European trade on Wednesday, as investors looked ahead to the Federal Reserve’s rate decision due later in the day for fresh guidance on the future path of U.S. interest rates.
While the Fed is widely expected to leave interest rates unchanged at the conclusion of its policy meeting at 18:00GMT, or 2:00PM ET, Wednesday, the U.S. central bank could provide guidance on its pace of tightening over the next several months.
Many in the market anticipate the pace of rate hikes to be gradual amid concerns over global economic growth and divergent monetary policies between the U.S. and other nations.
Market players expect one more rate hike this year, most likely in December, while the Fed’s forecasts point to two more. In December, the Fed forecast four rate hikes in 2016.
Besides the Fed, there is U.S. trade deficit data due at 12:30GMT, or 8:30AM ET, and pending home sales at 14:00GMT, or 10:00AM ET.
Gold for June delivery on the Comex division of the New York Mercantile Exchange inched up $4.10, or 0.33%, to trade at $1,247.50 a troy ounce by 06:50GMT, or 2:50AM ET.
A day earlier, gold tacked on $3.20, or 0.26%, boosted by a softer dollar and weak U.S. economic data.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, last stood at 94.41, little changed for the day.
Prices of the yellow metal are up nearly 17% so far this year as expectations faded that the Fed would move to normalize interest rates due to fears over a China-led global economic slowdown.
A gradual path to higher rates is seen as less of a threat to gold prices than a swift series of increases.
Elsewhere on the Comex, silver futures for May delivery jumped 27.5 cents, or 1.61%, to trade at $17.38 a troy ounce during morning hours in London, while copper futures declined 1.3 cents, or 0.56%, to $2.234 a pound.
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Written By: Investing.com
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