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Gold futures steady near 1-week high ahead of FOMC minutes

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Shutterstock photo - Gold futures were little changed near a one-week high during European morning hours on Wednesday, as market players awaited the release of the minutes from the Federal Reserve's policy-setting meeting last month.

On the Comex division of the New York Mercantile Exchange, gold futures for June delivery traded at USD1,586.25 a troy ounce during European morning trade, neatly flat on the day.

Comex gold prices held in a tight range between USD1,584.15 a troy ounce, the daily low and a session high of USD1,588.45 a troy ounce. Comex gold rose to USD1,590.05 a troy ounce on Tuesday, the strongest level since April 2.

Gold prices were likely to find support at USD1,539.85 a troy ounce, the low from April 4 and an 11-month low and resistance at USD1,604.25, the high from April 2.

Gold traders are looking ahead to the release of the minutes of the Federal Reserve's March policy meeting later in the session for further hints on the future of its monetary policy.

The U.S. Department of Labor said last week that the economy added 88,000 jobs last month, the smallest increase since last June and far below forecasts for an increase of 200,000.

The data also showed that the unemployment rate ticked down to 7.6% from 7.7% in February, but the decline stemmed from more people dropping out of the labor force. The participation rate fell to 63.3%, the lowest level since 1979.

The dismal jobs report fuelled fears that the recovery in the labor market is losing momentum, easing recent jitters the Fed would start to withdraw its super easy monetary policy.

The central bank previously stated that monetary policy will remain accommodative "at least as long" as the jobless rate remains above 6.5%.

Moves in the gold price this year have largely tracked shifting expectations as to whether the U.S. central bank could bring quantitative easing, one of the biggest boosts to gold's bull run, to an end this year.

The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was down 0.1% to trade at 82.38, the lowest level since March 25.

Dollar weakness usually benefits gold, as it boosts the metal's appeal as an alternative asset and makes dollar-priced commodities cheaper for holders of other currencies.

Elsewhere on the Comex, silver for May delivery rose 0.2% to trade at USD27.94 a troy ounce, while copper for May delivery shed 0.2% to trade at USD3.434 a pound.

Official trade data released earlier showed that China posted a USD884 million surprise trade deficit for March compared with February's USD15.25 billion surplus. Economists had expected a USD15.4 billion surplus.

The data showed that Chinese imports rose 14.1% from a year earlier in March, blowing past expectations for a 6% increase and following a decline of 15.2% in February.

Exports grew 10% from a year earlier in March, below expectations for an 11.7% gain and down from a 21.8% increase in the previous month.

China is the world's largest copper consumer, accounting for almost 40% of world consumption last year. - offers an extensive set of professional tools for the Forex, Commodities, Futures and the Stock Market including real-time data streaming, a comprehensive economic calendar, as well as financial news and technical & fundamental analysis by in-house experts.

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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.

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