Investing.com - Gold prices fell in Asia on Thursday as minutes from the Federal Reserve suggest a near-term rate hike is possible.
On Wednesday, minutes released by the Federal Reserve from its April policy meeting suggested an interest-rate increase in June was possible if incoming data showed an improving economy.
As well, an assessment of risks posed by global economic and financial conditions was downplayed, and the minutes pointed to additional strengthening of the U.S. labor market despite an apparent slowdown in economic activity.
On the Comex division of the New York Mercantile Exchange, gold for June delivery fell 0.97% to $1,262.05 a troy ounce.
Silver futures for July delivery dropped 1.18% to $16.930 a troy ounce. Copper futures gained 0.05% to $2.063 a pound.
Overnight, gold inched down halting a three-day winning streak, as investors traded cautiously.
Last month, the Federal Open Market Committee (FOMC) voted 9-1 to leave the target range of its benchmark Federal Funds Rate unchanged between 0.25 and 0.50%. At the time, the FOMC said it will assess economic conditions, measures of labor market conditions, indications of inflationary pressures and expectations, as well as readings on financial and international developments in determining the scope of future adjustments to the Fed Funds Rate.
Gold traders also digested hawkish comments from a pair of non-voting FOMC members on Tuesday regarding the potential for multiple rate hikes by the Fed before the end of 2016. At a joint appearance in Washington, both Atlanta Fed president Dennis Lockhart and San Francisco Fed president John Williams suggested that "two to three rate hikes," this year seems possible, while Lockhart noted that a rate hike will still remain on the table at the FOMC's next meeting on June 14-15.
Any rate hikes by the Fed this year are viewed as bearish for gold, which struggles to compete with high-yield bearing assets in rising rate environments.
Elsewhere, the Atlanta Fed said on Wednesday morning that business inflation expectations increased 0.2 in its May reading to 1.9, its strongest reading since January. It came one day after the Bureau of Labor Statistics' Consumer Price Index (CPI) rose 0.4% in April, amid a surge in gasoline prices. The Core CPI Price Index, which strips out volatile food and energy prices, gained 0.2% in line with analysts' expectations.