Gold edges down as investors cautiously eye Fed verdict

Gold edges down as investors cautiously eye Fed verdict

Gold prices inched lower on Wednesday as investors awaited the result of a U.S. Federal Reserve policy meeting to assess how the central bank plans to combat rising inflation and ease worries about economic recovery.


* Spot gold fell 0.2% to $1,784.04 per ounce by 0138 GMT. U.S. gold futures dropped 0.2% to $1,785.30.

* The Fed is expected to announce its stimulus tapering timeline at 1400 GMT on Wednesday. It is likely to begin paring its monthly asset purchases by $15 billion each month until ending them by mid-2022.

* Reduced stimulus and interest rate hikes tend to push government bond yields up, raising the opportunity cost of gold, which pays no interest.

* The end of Britain’s furlough programme has not led to a surge in new job-seekers, according to data that suggests unemployment is unlikely to rise sharply and could bolster the case for a Bank of England interest rate hike.

* Japanese policymakers on Tuesday reaffirmed the Bank of Japan’s commitment to its 2% inflation target in a meeting held between the central bank chief and the country’s economy and finance ministers.

* Activity in China’s services sector expanded at a faster pace in October, buoyed by robust demand, although rising inflationary pressures weighed on business confidence for the year ahead, a private survey showed on Wednesday.

* Spot silver fell 0.2% to $23.46 per ounce. Platinum was little changed at $1,037.49, while palladium gained 0.4% to $2,019.81. DATA/EVENTS (GMT) 1500 US ISM N-Mfg PMI Oct 1800 US Federal Open Market Committee announces its decision on interest rates followed by statement (Reporting by Nakul Iyer in Bengaluru; Editing by Ramakrishnan M.)

About Author

Related posts