FX:Gold futures little changed after Greece debt deal
Forexpros - Gold futures were steady during European morning hours on Tuesday, trading close to the previous session’s six-week high after euro-zone finance ministers reached a deal to release the next tranche of bailout funds to Greece.
On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1,752.75 a troy ounce during European morning trade, little changed on the day.
Prices traded in a tight range between USD1,750.95 a troy ounce, the daily low and a session high of USD1,754.15 a troy ounce. Futures touched a six-week high of USD1,754.65 a troy ounce on Monday.
Gold prices were likely to find support at USD1,720.25 a troy ounce, the low from November 21 and resistance at USD1,774.95, the high from October 12.
Euro zone finance ministers, the European Central Bank and the International Monetary Fund reached an agreement in a meeting that wrapped up early Tuesday in Brussels to reduce Greece’s debt-reduction target by EUR40 billion to 124% of gross domestic product by 2020.
Other measures included an extension of loan maturities, a cut in the interest rates that Greece is paying on the loans from its international partners, as well as a debt buyback.
Athens was also cleared to receive a much-needed EUR34.4 billion loan installment in December, easing fears over a messy near-term default and potential exit from the euro zone.
Eurogroup Chairman Jean-Claude Juncker said euro zone ministers would formally approve the release of the aid payment on December 13.
However, market players remained cautious as the latest agreement does not offer a fundamental resolution to the euro zone's debt crisis.
Meanwhile, markets participants continued to monitor developments surrounding the looming “fiscal cliff” in the U.S., approximately USD600 billion in automatic tax hikes and spending cuts due to come into effect on January 1.
Republicans in the U.S. Congress on Monday called on President Barack Obama to detail long-term spending cuts to help solve the country's fiscal crisis, while holding firm against the income tax rate increases for the wealthy that Democrats seek.
There are fears the U.S. economy will fall back into a recession, unless a divided Congress and the White House can work out a compromise in the seven weeks left before the January 1 deadline.
Elsewhere on the Comex, silver for December delivery dipped 0.1% to trade at USD34.20 a troy ounce, while copper for December delivery added 0.2% to trade at USD3.555 a pound.
