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Gold futures trade in tight range ahead of Fed

Published 06/22/2011, 03:42 AM
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Investing.com – Gold prices traded in a tight range on Wednesday, steadying near a two-week high, as investors awaited the conclusion of the Federal Reserve’s policy setting meeting later in the day.

On the Comex division of the New York Mercantile Exchange, gold futures for August delivery traded at USD1,547.65 a troy ounce during late Asian trade, easing up 0.02%.              

The gold contract traded between a range of USD1,545.75, the daily low and USD1,548.85, the daily high.

Markets turned their attention to the Federal Reserve's policy setting meeting, which was to be followed with a press conference by Fed Chairman Ben Bernanke later in the day.

Mr. Bernanke was widely expected to reaffirm the bank’s pledge to hold interest rates near zero for an extended period, while investors will watch for clues regarding the current round of quantitative easing, which was due to end on June 30.

The program, which injected significant liquidity into the U.S. economy, has been a key supporting factor for gold over the past 12 months, which favors loose market conditions and a weak U.S. dollar.

When the Fed announced the second round of quantitative easing in November last year, gold prices scored record highs for four consecutive sessions.

Meanwhile, Greece’s parliament supported Prime Minister Papandreou’s new cabinet on Tuesday, wining the support of 155 out of 300 parliament members.

The confidence vote fuelled hopes that Greek lawmakers would support next week’s vote on harsh austerity measures, which include EUR28 billion in spending cuts and new taxes over the next five years.

Elsewhere, silver for July delivery dipped 0.03% to trade at USD36.40 a troy ounce during late Asian trade, while copper for July delivery shed 0.16% to trade at USD4.080 a pound.

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