NEW YORK (TheStreet) -- Gold prices have edged lower Monday as investors continue to digest information from minutes of the Fed's June 22 to 23 meeting, which were released on Wednesday and suggested the possibility of deflationary pressures.
The yellow metal, which is often used as an inflationary hedge, was falling by $1.80 to $1,186.40 an ounce for August delivery on the Comex division of the New York Mercantile Exchange. The gold price Monday has traded as high as $1,194.70 and as a low as $1,185.60. The U.S. dollar index was relatively flat at $82.55. The spot gold price was falling more than $9, according to Kitco's gold index.
The Fed's minutes indicated that "several participants noted that a continuation of lower-than-expected inflation and high unemployment could eventually lead to a downward movement in inflation expectations that would reinforce disinflationary pressures."
In their discussion of monetary policy for the period ahead, members agreed that it would be appropriate to maintain the record-low target range of 0 to 0.25% for the federal funds rate.
Still, some officials had noted during the meeting the possibility of a potentially unsustainable fiscal position, and that the size of the Federal Reserve's balance sheet could boost inflation expectations and actual inflation over time.
Gold prices are lower also as investors wait for results of stress tests of EU banks. This data is set to come out on Friday. They'll also be focusing on key economic events such as the housing market index data from the The National Association of Home Builders set to be released at 10 a.m. eastern time Monday and Bernanke's to testimony on monetary policy Wednesday in front of the Senate Banking Committee as well as the House Financial Services Committee on Thursday.
Silver prices were trading sideways at $17.78 while copper prices were at $2.94.
