Gold prices stood little changed on Wednesday after the dollar recouped early losses, with investors awaiting the release of the US Federal Reserveâ€™s minutes from its September meeting for clues on further interest rate hikes this year.
Spot gold was unchanged at $1,287.70 an ounce by 9.39am. It touched its highest level since 27 September in the previous session. US gold futures for December delivery eased 0.3% to $1,290 per ounce.
â€śSome money is just coming off the table ahead of the FOMC minutes and its just a bit of risk on. It just feels a little bit of heavier (for gold) with whatâ€™s going on with the dollar in Asia,â€ť a Hong Kong-based trader said. â€śItâ€™s probably going to be in $1280-1300 range for the moment.â€ť
Asian shares rose on Wednesday, tracking Wall Streetâ€™s rally to all-time highs, and the dollar pared early losses ahead of the release of the minutes from the Fedâ€™s September policy meeting later in the day, with a buoyant euro keeping a check on its gains. Markets are widely expecting the US central bank to raise rates in December, for a third time this year.
Gold is highly sensitive to rising interest rates, as these increase the opportunity cost of holding non-yielding bullion, while boosting the dollar in which the metal is priced.
â€ś$1,300 is a very psychological level for gold. We really need to peck on through that to see some more buying. Weâ€™re just going to be waiting for the FOMC minutes and run into a bit of profit taking for the time being,â€ť the trader added.
Spot gold may retrace to a support at $1,281 per ounce before resuming its rally towards a resistance at $1,299,Â ReutersÂ technical analyst Wang Tao said.
In other precious metals, silver rose 0.2% to $17.11 an ounce, having hit a three-week high in the previous session. Platinum was up 0.2% at $931.10 an ounce and palladium was trading 0.3% higher at $935.85 an ounce.