Metals - Gold steady as traders await Fed rate decision |
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Tue, 30 Jan 2007 12:51
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LONDON (AFX) - Gold steadied after edging lower yesterday, with many players reluctant to take positions ahead of the US Federal Reserve's interest rate decision on Wednesday.At 11.22 pm, spot gold was quoted at 642.80 usd an ounce, down slightly from the 643.20 usd level seen at the time of the COMEX market close in New York yesterday.'Gold is biding time ahead of the FOMC decision ... (which) will give a lead to the dollar and then to gold,' said Ross Norman, analyst at TheBullionDesk.com.Gold often moves counter to the dollar because it is seen as an alternate investment to the US currency. Yesterday, the precious metal edged lower after the dollar hit four-year highs against the yen.The dollar has remained near those highs today and while many players expect the Fed will likely keep rates on hold, some are predicting hawkish comment from the central bank.Such comment would support the dollar and pressure gold, but many analysts remain upbeat about gold's prospects, saying oil prices might support the precious metal near term.Gold often moves in line with crude because is it seen as a hedge against oil-led inflation.'In the very near term you have to watch oil, the dollar is on hold... I would be inclined towards the upside (for gold),' said Norman.Oil edged up today after dipping lower yesterday, as traders took comfort from the continued cold weather in the US Northeast, which is expected to boost heating oil demand and eat into fuel inventories.maytaal.angel@thomson.comas/ma/wjCOPYRIGHTCopyright AFX News Limited 2006. All rights reserved.The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.AFX News and AFX Financial News Logo are registered trademarks of AFX News Limited
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Precious metals at record high prices 