What’s next? – GOLD 06.12.17

Wed, Dec 6 2017, 08:19 GMT

by Fort Financial Services

Gold futures were higher in early hours on Wednesday as market players looked ahead to unofficial employment data later in the day.

 

On the Comex division of the New York Mercantile Exchange, gold futures were up 0.32 percent at $1.269.20 a troy ounce as of 05:35 GMT.

 

On Tuesday, the yellow metal traded in red territory as the recent green light to a major US tax reform bill continued to support the American currency across the board.

 

Gold futures were down about 0.21 percent at $1,275.10 per ounce as of 12:40 GMT.

 

The dollar recovered following the approval of Republican-drafted tax reform bill by the Senate, which is meant to reduce taxes and therefore, boost economic growth and inflation levels.

 

Those factors would push the Federal Reserve to increase interest rates at a faster pace, and maybe even consider ramping up the plan to unwind the regulator’s massive balance sheet.

 

Reports released in the last few days are suggesting a joint resolution between the Senate and the House of Representatives will be ready before Christmas.

 

The US dollar index, which gauges the American currency against six major rivals, was trading at 93.18 by the time of this writing, down 0.16 percent.

 

Dollar-denominated gold is sensitive to interest rate moves. A stronger base currency makes the metal more expensive and less competitive for investors holding other currencies.

 

Ahead in today’s session, German factory orders for October are up at 07:00 GMT, with a 0.3 percent decline seen. In the United States, focus will be directed to the ADP nonfarm employment change for November, a report that anticipates official NFP on Friday.

Published on Wed, Dec 6 2017, 08:19 GMT

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