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Gold moves slightly lower in advance of release of Fed's monthly minutes

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Shutterstock photo - -- Gold futures dipped on Wednesday ahead of the release of the Federal Reserve's minutes from its March meeting later in U.S. afternoon trading.

On the Comex division of the New York Mercantile Exchange, gold futures for June delivery fell 7.50 to 0.62% to $1,203.10 a troy ounce. Gold has moved down over the last two sessions after a substantial rally on Monday when the precious metal rose more than $20 an ounce to reach $1,224.50, its highest level in more than six weeks.

Before the mid-week sell-off, gold futures had been up more than 6% since Mar. 17 when it plunged to $1,140.60, as strong economic indicators increased the possibility that the Fed could raise interest rates. Gold likely received support on Wednesday at $1,205.70, the low from Mar. 26 and resistance at $1,227.90, the high from Feb. 13.

A disappointing U.S. jobs report on Friday, however, has fueled speculation that the Fed could delay lift-off on its first interest rate hike in more than five years.

Gold struggles to compete with high yield bearing assets in periods of rising interest rates.

Earlier on Wednesday, Federal Reserve Bank of New York president William Dudley said in an interview with Reuters that the Fed has not ruled out a June rate hike. Dudley indicated, though, that weaker than expected GDP growth in the first quarter and slower labor progression in March have "set the bar higher" for lift-off in June.

"I could imagine circumstances where a June rate hike is still in play," Dudley told Reuters. "If the next jobs report is strong...if second-quarter GDP look like it is bouncing quite sharply."

Last Friday, the U.S. Bureau of Labor Statistics said in its March jobs report that said the economy added 126,000 in March, halting a streak of 12 consecutive months of job growth that exceeded 200,000. The modest job increases nationwide marked the weakest period of hiring in 15 months. In terms of average weekly earnings, employees nationwide received the smallest annual gains in wages since last June.

The U.S. Dollar Index, which measures the strength of the greenback versus a basket of six other major currencies, ticked down slightly by 0.29% to 97.96, amid slight demand increases in Wednesday's U.S. 10-year note auction.

Gold becomes more expensive for foreign purchasers when the dollar is stronger.

Elsewhere, silver for May delivery fell 0.372 or 2.21 to $16.468 a troy ounce.

Copper futures for May delivery also dropped 0.032 or 1.17% to $2.731 a pound. offers an extensive set of professional tools for the financial markets.

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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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