Gold prices inch up after dovish Fed stance

Gold prices edged higher for a second day on Thursday as the dollar extended losses after minutes of the latest Federal Reserve meeting hinted at a dovish approach to interest rate hikes in the United States.

Spot gold was up 0.1 percent at $1,294.58 per ounce at 0046 GMT, after gaining nearly 0.2 percent in the previous session. U.S. gold futures for June delivery were up 0.3 percent at $1,294 per ounce.

The dollar index, which measures the greenback against a basket of six major currencies, eased 0.1 percent at 93.925.

Asian shares moved lower on Thursday as investors fretted about new setbacks in U.S.-China trade talks, but negative sentiment was tempered by U.S. Federal Reserve meeting minutes suggesting it would not raise the tempo at which it increases interest rates.

Most Federal Reserve policymakers thought it likely another interest rate increase would be warranted “soon” if the U.S. economic outlook remains intact, minutes of the central bank’s last policy meeting showed.

U.S. President Donald Trump said on Wednesday he would know next week whether his summit with North Korean leader Kim Jong Un would take place as scheduled, casting further doubt on plans for the unprecedented meeting.

Trump signaled a new direction in U.S.-China trade talks and said any deal would need “a different structure,” fueling uncertainty over current negotiations and sending U.S. stocks lower.

The European Central Bank can still end its bond buying program later this year, two policymakers said on Wednesday, even as fresh data cast further doubt on the health of the euro zone economy.

Euro zone economic growth slowed much more sharply than expected this month, a business survey showed, which along with weaker inflation has intensified concerns there will be no return to the bloc’s recent boom times.

Source: Reuters