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Gold prices up in early Asia despite rising chances of Fed hike

Published 10/12/2016, 07:05 PM
Updated 10/12/2016, 07:07 PM
© Reuters.  Gold up in early Asia
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Investing.com - Gold prices gained in Asia on Thursday despite the mounting chances for a rate hike in the U.S. by the end of the year.

On the Comex division of the New York Mercantile Exchange, gold futures for December delivery rose 0.24% to $1,256.85 a troy ounce.

Elsewhere in metals trading, silver futures for December delivery rose 0.07% to $17.517 a troy ounce, while copper futures for December delivery gained 0.05% to $2.176 a pound.

Support for a rate hike this year rose as three members of the Federal Open Market Committee meeting who dissented at the last meeting may soon have the needed support for such a move, the minutes of the latest meeting showed Wednesday, with members noting a reasonable case could be made on both sides of the argument -- to increase rates or to wait for additional evidence on progress towards goals.

"Several members judged that it would be appropriate to increase the target range for the federal funds rate relatively soon if economic developments unfolded about as the Committee expected," the minutes of the Sept. 20-21 meeting said.

Overnight, gold prices edged higher on Wednesday, helped by a mild pullback from the U.S. dollar but the precious metal remained close to four-month lows amid growing expectations for a 2016 rate hike by the Federal Reserve.

Market expectations for a rate hike in December stood at 69.5%, according to the Investing.com Fed Rate Monitor Tool.

Gold is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion.

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