November 23, 2017 / 4:33 AM / 25 days ago

PRECIOUS-Gold prices dip on profit-taking amid Fed inflation concerns

    * Fed minutes show many policymakers see near-term rate hike
    * Markets in Japan, U.S. closed on Thursday
    * Spot gold may test support at $1,283 per ounce -
technicals

 (Updates prices)
    By Vijaykumar Vedala
    Nov 23 (Reuters) - Gold prices nudged lower on Thursday,
with investors taking profits after gains of nearly 1 percent in
the previous session on weaker U.S. economic data and concerns
among some Federal Reserve policymakers over lower inflation. 
    Many Fed policymakers expect that interest rates will have
to be raised in the "near term", the minutes of the U.S. central
bank's last policy meeting showed on Wednesday. 
    However, some members expressed concern over the inflation
outlook and emphasized they would be looking at upcoming
economic data before deciding the timing of future rate
rises.            
    Spot gold        was down 0.2 percent at $1,289.88 per ounce
by 0741 GMT. 
    U.S. gold futures         for December delivery edged down
0.2 percent to $1,289.70.
    "There appears to be a bit of profit taking ... With the
impending rate hike from the Fed next month, maybe (investors
think) gold prices have gone a bit too high and will come down
in the aftermath of the rate hike," said John Sharma, an
economist with National Australia Bank. 
    "The Fed has some inflation concerns and we don't know how
it's going to be in the medium term. There is lot of uncertainty
everywhere and you can see it in gold's (rangebound) movement." 
  
    Earlier in the week, Fed Chair Janet Yellen stuck by her
prediction that U.S. inflation will soon rebound but offered an
unusually strong caveat: she is "very uncertain" about this and
is open to the possibility that prices could remain low for
years to come.             
    "Although the minutes seemed to tick a December hike as a
done deal, traders took fright at their more 'data-driven'
neutral stance into 2018," said Jeffrey Halley, a senior market
analyst with OANDA. 
    "Gold was one of the chief beneficiaries of the ensuing
general dollar sell-off (on Wednesday) as the U.S. heads into
its Thanksgiving break ... We would expect trading over the
coming two days to be muted with the U.S. away." 
    U.S. markets are closed on Thursday for the Thanksgiving
holiday, while Japan also has a public holiday.
    Spot gold may test a support at $1,283 per ounce as it
failed to break resistance at $1,297, according to Reuters
technical analyst Wang Tao.              
    In currencies, the dollar touched a two-month low against
the yen and hit a one-month trough against a basket of six major
currencies        on Thursday.       
    Meanwhile, silver        was down 0.4 percent at $17.088 an
ounce, platinum        fell 0.6 percent to $932.50 an ounce,
while palladium        was down 0.1 percent at $1,002.05 an
ounce.

 (Reporting by Vijaykumar Vedala in Bengaluru; Editing by
Richard Pullin and Joseph Radford)
  

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