Gold Shakes Off Losses on Dovish Fed Tone

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Gold prices fell on Thursday as some investors trimmed their gold holdings ahead of minutes from the Federal Reserve’s September policy meeting, scheduled for release later in the day.

The most actively traded contract, for December delivery, was recently down $4.50, or 0.4%, at $1,144.20 a troy ounce on the Comex division of the New York Mercantile Exchange.

Gold prices have marched higher in the weeks since Fed officials held off on raising rates at their Sept. 16-17 meeting. While the U.S. economy had continued to gather momentum, it hadn’t yet reached the stage that warranted tighter monetary policy, officials said in their post-meeting communiqué. The news had benefited gold, which pays its holders nothing and would struggle to compete with yield-bearing investments once rates climb.

On Thursday, gold traders hoped to get fresh insight on the likely timing of the first U.S. interest rate increase in nearly a decade.

“The makeup of the minutes will be important to see how much, really, debate there was and if there were a number of members close to going the other way on the vote,” said Bill O’Neill, co-founder of commodities investment company Logic Advisors.

Gold prices have also drawn strength from lackluster U.S. employment and manufacturing data in recent weeks, which stocked hopes that Fed officials would put off raising rates till 2016.

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