Gold Futures Fall a Second Day as Dollar Gains After Fed Minutes

Gold futures declined for a second day as the dollar strengthened on expectations U.S. policy makers are moving closer to raising interest rates.

 

The Bloomberg Dollar Spot Index headed for the highest close since March 2009 on the outlook for Japan to extend a stimulus program and after minutes of the Federal Reserve’s Oct. 28-29 meeting showed the U.S. moving toward higher interest rates. Many officials said the Fed should remain attentive to evidence of a possible downward shift in longer-term inflation expectations, according to the minutes released yesterday.

 

Higher borrowing costs cut the allure of the metal which generally offers investors returns through rising prices and which is sometimes bought as an inflation hedge. Prices had also dropped before the Fed minutes were released as a poll yesterday showed Swiss voters will reject an initiative that would require the nation’s central bank to boost bullion holdings.

 

Gold for December delivery fell 0.4 percent to $ 1,189.10 an ounce by 9:36 a.m. London time on the Comex in New York. It reached a three-day low of $ 1,173.90 yesterday. Bullion for immediate delivery added 0.6 percent to $ 1,189.74 in London, according to Bloomberg generic pricing.

 

Source : Bloomberg

 


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Pound Approaches 14-Month Low as Goldman Sees Rate-Boost Delay

The pound approached a 14-month low versus the dollar as Goldman Sachs Group Inc. pushed back its forecast for the first interest-rate increase since 2007, citing worsening growth and the outlook for inflation.

Gilts advanced as a report showed euro-area manufacturing and services expanded at the slowest pace in 16 months, adding to concern that the economic slump in Britain’s biggest trading partner is deepening. The report overshadowed data that showed U.K. retail sales rose at the fastest pace in six months. Goldman now predicts the Bank of England will raise its benchmark rate by 25 basis points in the fourth quarter of next year, compared with the first quarter in a previous forecast.

The pound dropped 0.1 percent to $ 1.5661 at 10:51 a.m. London time, its sixth decline in seven days. The U.K. currency slid to $ 1.5590 yesterday, the lowest since Sept. 6, 2013. Sterling strengthened 0.1 percent to 79.96 pence per euro, having reached 80.39 pence yesterday, the weakest level since Oct. 15.

Source : Bloomberg


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Gold Futures Trade Below Two-Week High as Fed to Buying Weighed

Gold futures traded little changed below a two-week high as investors weighed expectations for higher U.S. interest rates against signs of more physical buying.

 

The Bloomberg Dollar Spot Index traded near a five-year high on the outlook for Japan to extend a stimulus program and after minutes of the Federal Reserve’s Oct. 28-29 meeting showed the U.S. moving toward higher interest rates. Higher borrowing costs cut the allure of the metal which generally offers investors returns through rising prices and which is sometimes bought as an inflation hedge.

 

Gold for December delivery was little changed at $ 1,192.20 an ounce by 7:14 a.m. on the Comex in New York. Prices, which reached a three-day low yesterday, touched a two-week high of $ 1,204.10 on Nov. 18. Bullion for immediate delivery rose 0.8 percent to $ 1,192.44 in London, according to Bloomberg generic pricing.

 

Source : Bloomberg


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