Investing.com – Gold prices drifted lower in holiday-thinned trade on Thursday, but losses were capped on speculation the Federal Reserve might not tighten U.S. policy as aggressively as previously thought.
Comex were down about $2.00, or around 0.2%, to $1,290.13 a troy ounce by 3:15AM ET (0815GMT). Trade volumes were expected to remain light on Thursday, with Comex floor trading scheduled to remain closed for Thanksgiving. An abbreviated session was slated for Friday.
The yellow metal as the U.S. dollar fell to a four-week low after minutes from the Federal Reserve’s November meeting hinted that the central bank may not be as aggressive in raising interest rates next year as expected due to concern over the sluggish inflation outlook.
That raises the question of whether the Fed will stick to three planned rate increases in 2018.
The U.S. central bank is scheduled to hold its final policy meeting of the year on Dec. 12-13, with interest rate futures pricing in a 100% chance of a rate hike at that meeting, according to Investing.com’s . For 2018, the Fed is currently forecasting three interest rate hikes, but the markets expect two at most.
Gold is highly sensitive to rising rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar, in which it is priced.
In other metals trading, dipped 3.0 cents, or 0.2%, to $17.08 a troy ounce, was down 0.4% at $936.55, while slipped 0.3% to $998.62 an ounce.
Meanwhile, declined 1.2 cents, or 0.4%, to $3.127 a pound.
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Source: Investing.com
