Gold prices ended the U.S. day session modestly higher Tuesday, on some short covering and bargain hunting following recent losses that saw prices hit a nine-month low last week. However, gains in the safe-haven metal were limited today by continued investor optimism, evidenced by major U.S. stock indexes all scoring record highs. December Comex gold was last up $2.40 an ounce at $1,212.30. December Comex silver was last up $0.139 at $16.66 an ounce.
Gold held steady early Wednesday as markets await minutes from the November Federal Reserve policy meeting for more clues on an anticipated interest rate hike.
Look for even quieter trading the rest of this week, as the U.S. Thanksgiving holiday is on Thursday, when U.S. markets are closed. Friday typically sees one of the slowest trading days of the year in many markets. And on Wednesday many U.S. market participants will hit the exit doors early.
Investors cut holdings in gold exchange-traded products for an eighth consecutive session, the longest run in almost a year, amid speculation that the Federal Reserve will raise U.S. interest rates next month.
Assets fell 9.43 metric tons to 1,923.1 tons Monday, the lowest since July, data compiled by Bloomberg show. Gold futures swung between gains and losses on Tuesday and are heading for the biggest monthly decline since May.
The Federal Reserve is definitely lifting interest rates next month — if the market has priced a key contract correctly. According to the trading of federal funds futures contracts, there’s a 100% chance — actually, a 100.2% chance — that the Fed will lift interest rates to a range between a half-point and three-quarters of a point, up from the current 25 to 50 basis points range. (The extra 0.2% implies there’s a very small chance the Fed could be even more aggressive.)
Reference: MarketWatch, KITCO, Reuters, Bloomberg
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