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Gold Flat Ahead of Fed Minutes, G20

Published 11/27/2018, 11:30 PM
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Investing.com - Gold prices were virtually flat on Wednesday morning trade in Asia, with little investor activity and no clear catalysts to drive prices in either direction.

Gold futures for February delivery were up 0.1% to $1,221.10 by 10:15PM ET (03:13AM GMT) on the Comex commodity exchange.

Gold has been moving for almost two weeks within a relatively narrow range within a few dollars in either direction, struggling to gain traction and resisting big drops.

Part of the lacklustre trade in gold may be due to a strengthening of the U.S. dollar over the past couple of weeks. The U.S. Dollar Index, that tracks the greenback against the basket of currencies, was flat at 97.37. The index has rebounded from 96.19 on Nov. 19.

Gold traders are awaiting Thursday's minutes of the Federal Reserve's November meeting for fresh indications on the future path of interest rates. Higher interest rates put downward pressure on non-yielding gold and shore up the dollar.

Another possible catalyst for gold are any developments in the U.S.-China trade war from an upcoming meeting between President Donald Trump and Chinese President Xi Jinping during the G20 Summit in Argentina.

In a report released on Monday, Goldman Sachs said commodity prices could surge over the next year, rebounding from prices that are now below fundamentals, according to a report quoted by Bloomberg News. The investment bank believes the current low prices “offer and extremely attractive entry point for longs in oil, gold and base.”

Goldman believes a catalyst for a rebound in prices to be the G20 meeting, where the political uncertainties that have held commodity prices down “have a significant chance of being addressed”.

Silver futures for March delivery were up 0.20% to $14.250. Copper for March delivery was up 0.44% to $2.748.

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