FX:Gold futures bounce off 7-week low after Fed statement
Forexpros - Gold futures bounced off the lowest level in seven weeks during European morning trade on Thursday, after the Federal Reserve reiterated its policy stance amid concerns over the U.S. economy.
On the Comex division of the New York Mercantile Exchange, gold futures for December delivery traded at USD1,717.15 a troy ounce during European morning trade, up 0.95%.
Prices rose by as much as 1% earlier in the day to hit a session high of USD1,717.95 a troy ounce. On Wednesday, gold prices fell to USD1,699.65 a troy ounce, the cheapest level since September 7.
Gold prices were likely to find support at USD1,688.85 a troy ounce, the low from September 7 and resistance at USD1,731.25, the high from October 22.
The Federal Reserve announced no new measures at the end of a two-day meeting Wednesday.
In its rate statement, the central bank said the economy is improving moderately, but that growth has been slow and unemployment remains elevated.
The central bank also said it planned to keep its benchmark short-term rate close to zero through mid-2015.
The Fed vowed in mid-September to buy USD40 billion in mortgage securities each month until the economy improves in a third round of what is known as quantitative easing, or QE3.
Moves in the gold price this year have largely tracked shifting expectations as to whether the U.S. central bank would pump more money into the financial system.
Later in the day, the U.S. was to release official data on durable goods orders, as well as reports on pending home sales and initial jobless claims. The country is scheduled to release third quarter growth data on Friday.
Meanwhile, market players continued to eye developments surrounding Spain, amid ongoing uncertainty over whether the debt-strapped country is moving closer to formally requesting a bailout from its euro zone partners.
A bailout would allow the European Central Bank to step in and buy Spanish sovereign debt, which would result in reduced borrowing costs for the debt-strapped nation. But Spain has been reluctant to do so because it may come with conditions on its budget.
Elsewhere on the Comex, silver for December delivery rallied 1.9% to trade at USD32.22 a troy ounce, while copper for December delivery added 0.35% to trade at USD3.580 a pound.
