Gold futures rose for the third consecutive session on Wednesday, as investors turned their attention to the minutes of the Federal Reserve’s September meeting, due out later in the day, for fresh indications on the future possible direction of U.S. monetary policy.
A day earlier, gold tacked on $5.10, or 0.42%, to settle at $1,212.40. The metal fell to a ten-month low of $1,183.30 on October 6.On the Comex division of the New York Mercantile Exchange, goldfor December delivery traded at $1,217.60 a troy ounce, up $5.20, or 0.43%.
Futures were likely to find support at $1,183.30, the low from October 6, and resistance at $1,224.00, the high from October 2.
Also on the Comex, silver for December delivery tacked on 9.7 cents, or 0.56%, to trade at $17.33 a troy ounce. Prices fell to a four-year low of $16.64 on October 3.
Market players were cautious ahead of the release of minutes from the Fed's September meeting later in the day, after upbeat U.S. employment data last week underlined optimism over the strength of the economy and fuelled expectations that the central bank will begin to raise rates sooner and faster than previously thought.
Expectations of higher borrowing rates going forward is considered bearish for gold, as the precious metal struggles to compete with yield-bearing assets when rates are on the rise.
Elsewhere in metals trading, copper for December delivery slumped 1.9 cents, or 0.62%, to trade at $3.020 a pound. Prices hit a six-month low of $2.985 on October 2.
The International Monetary Fund cut its global economic growth forecasts for the third time this year on Tuesday and warned that the recovery remains weak and uneven.
The organization is now forecasting global economic growth of 3.3% this year, down from 3.4% in July and expects growth of 3.8% in 2015, compared to an earlier prediction of 4.0%.
Investor sentiment was also hit after a report showing a steep decline in German factory orders in August fuelled fears that the euro zone’s largest economy is falling into a recession.
Copper is sensitive to the economic growth outlook because of its widespread uses across industries.
Investing.com
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