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Gold trades near 1-week low on U.S. economy, Fed outlook

Published 07/31/2014, 03:22 AM
Updated 07/31/2014, 03:22 AM
Gold holds below $1,300 on U.S. economy optimism, Fed outlook

Investing.com - Gold futures traded near a one-week low on Thursday, after the Federal Reserve tapered its monthly bond-buying program by another $10 billion and gave an upbeat assessment of the economy.

On the Comex division of the New York Mercantile Exchange, gold for December delivery fell to a session low of $1,292.90, the weakest level since July 24, before trimming losses to last trade at $1,296.40 during European morning hours, down 0.04%, or 50 cents.

Gold ended Wednesday’s session down 0.28%, or $3.60, to settle at $1,296.90 an ounce. Futures were likely to find support at $1,287.50, the low from July 24 and resistance at $1,314.60, the high from July 29.

The Fed cut its asset purchase program by $10 billion, staying on course to end the bond-buying program in October, and gave an upbeat assessment of the economy at the conclusion of its two-day meeting on Wednesday.

Before that, a Commerce Department report showed that the U.S. economy grew at a 4% annualized rate in the second quarter, after contracting by 2.1% in the first three months of the year.

Investors now turned their attention to Friday’s U.S. jobs report for July, which was expected to indicate that the recovery in the labor market is continuing.

Gold remained supported as tensions between Russia and the West over the situation in Ukraine remained high, while fighting between Israel and Hamas militants in Gaza also remained in focus.

The precious metal is often seen as a haven investment in times of geopolitical uncertainty.

Also on the Comex, silver for September delivery tacked on 0.59%, or 12.1 cents, to trade at $20.71 a troy ounce.

Elsewhere in metals trading, copper for September delivery dipped 0.04%, or 0.1 cents, to trade at $3.240 a pound.

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