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Gold dips on profit taking, waits cue from Fed minutes

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Investing.com -

Investing.com - Gold prices fell on Wednesday after investors locked in gains stemming from soft economic indicators in recent days and sold the precious metal for profits, eager for the release of the Federal Reserve's January policy meeting later in the session.

On the Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at US$1,320.10 a troy ounce during U.S. trading, down 0.32%, up from a session low of US$1,314.50 and off a high of US$1,323.00.

Futures were likely to find support at $1,312.80 a troy ounce, Tuesday's low, and resistance at $1,332.20, Monday' high.

Gold prices have risen in recent weeks due to soft jobs, manufacturing and other economic indicators that have prompted many investors to speculate that the Federal Reserve may slow the pace at which it tapers its asset-buying stimulus program.

The Fed is currently buying $65 billion in bonds a month to suppress interest rates to spur recovery, which weakens the dollar as a side effect, thus bolstering gold's image as a hedge.

Profit taking sent the yellow metal falling on Wednesday as investors jumped to the sidelines to await the release of the Fed's January policy meeting minutes, which many hope will act as a weather vane pointing to the direction of monetary policy.

Hit-or-miss data out of the U.S. failed to provide guidance ahead of time.

The Commerce Department reported earlier that U.S. housing starts fell 16% in January to 880,000 units, outpacing expectations for a 5.7% drop, though a series of winter storms may have played a factor.

The number of building permits issued last month declined by 5.4% to a seasonally adjusted 937,000 units, outpacing expectations for a 1.8% decline.

A separate report revealed that the U.S. producer price index rose 0.2% last month, beating forecasts for a 0.1% gain, while core producer prices were also up 0.2%.

Meanwhile, silver for March delivery was down 0.18% and trading at US$21.858 a troy ounce, while copper futures for March delivery were down 0.05% at US$3.284 a pound.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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