Gold turns lower after knee-jerk rally on Fed minutes

Gold turns lower after knee-jerk rally

 on Fed minutes

Gold turned lower on Thursday in a dramatic turnaround after Federal Reserve meeting minutes showed policymakers at the U.S. central bank were unsettled by signs of a global economic slowdown but that their outlook was
not "materially altered".
Spot gold eased 0.4 percent to $1,140.20 an ounce, having rallied 0.5 percent to $1,151.20 after the September minutes were released. futures for December delivery settled before the minutes were released, down 0.4 percent at $1,144.30 an ounce.
The Fed thought the economy was close to warranting an interest rate hike in September but policymakers decided it was prudent to wait for evidence a global economic slowdown was not knocking America off course, minutes from the Sept. 16-17 meeting showed.

"Gold's initial rally above $1,150 and subsequent modest sell-off reflects a deep ambivalence in theMARKET regarding the possibility of the December Fed rate hike," said Tai Wong, director of base and precious metals trading for BMO Capital Markets
"At first, gold reacted positively to the September Fed minutes which indicated that the FOMC would look for 'further improvement' in the laborMARKET, confirming that the outlook had not 'deteriorated significantly' before raising rates."
A delayed rate rise could support gold in the near term.


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