Gold Bounces A Bit, Finding Support Near $1,700

Gold futures bounced during Asian trading hours Thursday, finding support near the $1,700-an-ounce level after losing more than $50 over the past week, as the U.S. dollar weakened.

The most-actively traded December contract for the yellow metal  rose 0.4%, or $7.50, to $1,709.10 an ounce.

Gold futures had settled $7.80 lower in a regular session on the Comex division of the New York Mercantile Exchange overnight, after briefly dipping below the psychologically-important $1,700 level.

That drop came after the Federal Open Market Committee made no changes to its easy monetary policy stance, although it continued to express concern over the economic growth trajectory and weak employment trends.

“A highly accommodative stance by the Federal Reserve towards monetary policy is positive for gold prices in the medium term. … However, we continue to see some modest near-term pressure on gold,” HSBC Securities analysts James Steel and Howard Wen wrote to clients.

A weakened U.S. dollar  lent some support to metal prices.

The ICE dollar index, a measure of the greenback’s performance against a basket of six major global currencies, fell to 79.8750 by mid-afternoon in Hong Kong, from 79.932 in North American trade Wednesday.

The weaker dollar also aided the wider metals complex, with the December contracts for silver , copper  and palladium rising by 1% to $31.95 an ounce, by 0.2% to $3.58 a pound and by 1.3% to $600.55 an ounce.

Platinum futures for delivery in January  climbed 1% to $1,578.40 an ounce.

Marketwatch