Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Gold Prices Hold Steady Near 9-Month Highs Ahead of Fed Minutes

Published 02/20/2019, 09:29 AM
Updated 02/20/2019, 09:29 AM
© Reuters.

© Reuters.

Investing.com - Gold prices edged higher on Wednesday as investors waited for the publication of the minutes from the latest Federal Reserve policy meeting with expectations for them to confirm the central bank’s dovish policy stance.

At 9:25 AM ET (14:25 GMT), gold futures for April delivery on the Comex division of the New York Mercantile Exchange gained $1.95, or 0.15%, to $1,346.75 a troy ounce, its best level since May 14.

At 2:00PM ET (19:00 GMT), the Fed will release the minutes of the Jan. 30 meeting when it left interest rates on hold and pledged to be patient with further interest rate hikes, dropping its guidance that “further gradual” rate rises will be needed.

The central bank also said it could alter the pace of its balance sheet reduction “in light of economic and financial developments”.

Investing.com analyst Darrell Delamaide commented that policymakers are reaching a consensus after reversing course 180 degrees.

“Quantitative tightening, which Federal Reserve chair Jerome Powell likes to refer to as ‘balance sheet runoff’, is no longer on autopilot,” he said.

A string of officials - most recently Cleveland Fed president Loretta Mester and Fed governor Lael Brainard - have been talking up the pause in the balance sheet reduction.

The dovish shift in tone to the Fed’s message implies a longer pause in rate hikes, which keeps a lid on the opportunity cost of holding non-interest bearing gold.

In other metals trading, palladium futures marked yet another record high as stricter emissions standards pump demand for the metal used in catalytic converters. At 9:27 AM ET (14:27 GMT), the metal gained 1.04% to $1,468.95 an ounce, a new record high.

Palladium enjoyed its fifth straight session of gains on Wednesday as a report by Johnson Mathey forecasting a deficit in the market this year gave new legs to a rally now in its sixth month.

“While it's exciting to jump into an asset after good news, it could also be the worst time to do so, as it's the traders who got in before the headlines who take profits,” Investing.com analyst Pinchas Cohen warned.

Cohen offered three possible trading strategies according to risk profiles with an overall recommendation to remain cautious and wait to buy into a dip.

Latest comments

At 9:27 AM ET (14:27 GMT), the metal gained 1.04% to $1,468.95 an ounce, a new record high. I think this is typo , Gold never at 1,468$ today
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.