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Gold Prices Stabilize Near 1-Week Low Ahead of Fed Speakers

Gold steadies near 1-week low

Investing.com - Gold prices steadied on Wednesday, one day after suffering their biggest daily loss in almost four weeks, as markets continued to speculate over President Donald Trump's choice of a candidate to succeed Janet Yellen as Federal Reserve Chair.

Stanford University economist John Taylor, regarded by market watchers as more hawkish than Yellen, is currently seen as a front-runner, according to media reports.

Market players are also keeping an eye on current Fed Governor Jerome Powell and former Fed official Kevin Warsh as potential candidates to succeed Yellen when her term ends in February.

Trump, who is slated to meet with Yellen on Thursday, is expected to make his decision early in November.

The U.S. dollar extended gains after rising to its highest levels in a week overnight, while bond yields remained supported near recent highs, dampening the appeal of bullion.

Comex gold futures were little changed at $1,286.48 a troy ounce by 2:50AM ET (0650GMT). The yellow metal lost 1.3% on Tuesday after falling to a one-week low of $1,283.20.

Comments from New York Fed Chief William Dudley, considered a close ally of Fed Chair Yellen, will be in focus Wednesday. He is due to participate in a panel discussion along with Dallas Fed chief Robert Kaplan at an event in New York at 8:00AM ET (1200GMT).

Besides the Fed, today's economic calendar also includes data on housing starts and building permits at 8:30AM ET (1230GMT).

Interest rate futures are pricing in around a 90% chance of a December Fed rate hike according to Investing.com's Fed Rate Monitor Tool. The U.S. central bank has already raised rates twice this year.

Gold is highly sensitive to rising U.S. interest rates, which increase the opportunity cost of holding non-yielding bullion.

Elsewhere on the Comex, silver futures were flat at $17.03 a troy ounce. Among other precious metals, platinum dropped 0.3% to $931.75, while palladium added 0.6% to $981.83 an ounce.

Meanwhile, copper futures held steady at $3.194 a pound. Prices of the red metal rallied to their best level since Aug. 2014 at the start of the week, boosted by robust economic data from China, the world's top user of the red metal.

Investors looked to China's Party Congress for signs on future policy direction in the world's second-largest economy. This political meeting, which takes place once every five years, has a mandate of approving new policies as well as appointing to certain positions those individuals who will lead the Asian nation over the next five years.

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