US gold futures jumped by about $ 20 an ounce on Thursday, while the dollar was pressurized ahead of a public appearance by the president of the Federal Reserve, Janet Yellen, after the closing of the session, as investors digest passive indicators by the Fed minutes March that the US central bank shall remain careful with the time of its next rate hike.
On the Comex Exchange, gold for June delivery traded between $1,224.20 and $1,245.00 an ounce before settling at $1,238.90, up 15.00 or 1.23% on the day.
Spot gold benefited from a 17-month low in the dollar versus the Japanese yen. Prices touched a one-week high of dollar 1,239.30 an ounce and were up 1.2 percent at dollar 1,236.36.
The Minutes of March FOMC meeting on, released Wednesday, represent a divided committee, divided over whether to raise the target for its benchmark Federal Funds Rate range when it convenes again at the end of the month.
At its previous session, the FOMC voted 9 to 1 to leave the federal funds rate unchanged at a level of between 0.25 and 0.50%. One member, president of the Kansas City Fed Esther George, dissent at the meeting, while favoring an increase in light rate 25 basis points.
Several others members believed raising rates in March, the minutes showed. Citing evidence of the economy is expanding at a moderate pace, improving labor market conditions and continued firming of inflation, members discussed whether to raise rates further federal funds.
Most members, however, agree that there can be small space to ease mainstream politics through whether the economy or inflation suffered an unexpected shock. In addition, members had stressed that higher global risks and “asymmetric capabilities” of monetary policy to respond to shocks were sufficient factors to push the committee to express caution with the timing of future rate hikes. Note that the FOMC includes 10 references to “gradual” accommodation when monetary policy in it.
They said awaiting to raise rates twice in 2016, but the time of the walks is still unclear.
At the Multi Commodity Exchange, gold for delivery in far-month August rose Rs 156, or 0.54 per cent to Rs 28,970 per ten grams as participants enlarged positions.
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