Gold remains in positive despite dollar bounce
Gold futures steadied on Thursday, after the Federal Reserve’s May meeting minutes, raised concerns over whether the Federal Reserve would continue with its plan to introduce two additional rate hikes in 2017.
According to Federal Reserve’s minutes for its 2-3 May meeting, released on Wednesday, most Fed officials said a further increase in short-term interest rates will be needed “soon”, fuelling expectations that the U.S. central bank is poised to hike interest rates at its next meeting in June.
According to investing.com’s Fed rate monitor tool, nearly 80% of traders expect the Fed to hike interest rates in June.
U.S. economic growth, measured by Gross Domestic Product (GDP), rose by annualized rate of just 0.7% for the first three months of 2017. It was the slowest period of first-quarter economic growth since 2014.
Gold for June delivery on the Comex division of the New York Mercantile Exchange added $2.85 or 0.23%, to $1,255.95 a troy ounce by 13:32 EDT.
A surge in the dollar, however, weighed on gold prices, which dropped to session lows, following bullish jobless claim data, boosting sentiment that the economy is continuing to show signs of a rebound in the second quarter.
The U.S. Department of Labor reported that initial jobless claims decreased by 4,000 to 234,000 in the week ended May 18.