Gold heads south ahead of hawkish Fed minutes
On Wednesday, gold futures edged down following modest overnight revenues, as market participants looked ahead to the Fed’s minutes of April’s monetary policy meeting. Most traders find it hawkish.
In New York, June delivery gold futures went down $2 or simply 0.16%, trading at 1,274.80.
Traders need the Fed’s minutes on April’s meeting to make it clear whether the US major bank is going to increase rates or not in the nearer future.
The Fed left its interest rates intact following its gathering on April 27 and gave a statement that it wasn’t necessary to speed up another rate hike. The US major bank wants more confidence in the national economy’s health before getting down to another rate hike.
By the way, the Fed has previously disclosed it ambitious plans to increase interest rates several times before the end of 2016, while traders expect one more hike, probably in December.
Yesterday gold gained 0.21%, but traders remained cautious after strong American inflation reports as well as comments from the Fed’s officials, who rekindled prospects of rate hikes this year.