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Gold falls then rebounds amid uncertainty over interest rate hike

​CHICAGO
2017-10-12 08:57

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Gold futures on the COMEX division of the New York Mercantile Exchange fell on Wednesday but rebounded in following electronic trading.

The most active gold contract for December delivery first went down 4.90 dollars, or 0.38 percent, to close at 1,288.90 dollars per ounce.

As for other precious metals, silver for December delivery fell 7.4 cents, or 0.43 percent, to close at 17.133 dollars per ounce. Platinum for next January went down 3.30 dollars, or 0.35 percent, to settle at 933.20 dollars per ounce.

However, after the U.S. Federal Reserve released its September policy meeting minutes in the afternoon, showing the persistence of low inflation had made FED officials wondering whether another interest rate hike was necessary in December, gold futures reversed downturn and rallied.

According to the minutes, "Many participants expressed concern that the low inflation readings this year might reflect not only transitory factors, but also the influence of developments that could prove more persistent, and it was noted that some patience in removing policy accommodation while assessing trends in inflation was warranted. "

"A few of these participants thought that no further increases in the federal funds rate were called for in the near term or that the upward trajectory of the federal funds rate might appropriately be quite shallow," the minutes of the September 19-20 joint meeting of the Federal Open Market Committee and the FED Board of Governors revealed.

In response, the U.S. dollar index, a measure of the greenback against a basket of other major currencies, slid 0.37 percent to 92.76 as of 1937 GMT.
A weakening dollar pushed up gold prices.
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