Gold price edges lower as Fed minutes continue to weigh

New York (May 21)  Gold futures are under pressure, edging lower a day after minutes of the Federal Reserve’s April meeting further diminished expectations for a June interest-rate hike.

Gold for June delivery on Comex GCM5, -0.27%  dropped $6.40, or 0.5%, to $1,202.50 an ounce, while July silver SIN5, +0.22%  lost 4.3 cents, or 0.3%, to $17.07 an ounce.

The April minutes, released after the close of open-outcry metals trade on Comex, showed only a “few” Fed officials thought economic data would justify a rate hike in June.

“The minutes seem to indicate that while the committee is very unlikely to hike in June, a hike is coming and the only warning will be in the data,” said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management.

The initial market reaction Wednesday afternoon “seemed to reflect the market has not fully priced the likelihood of a rate hike in July or September, which seem to be of a higher probability given Fed minutes,” he said.

Gold added slightly to losses after data showed first-time claims for U.S. unemployment benefits rose by 10,000 to a seasonally-adjusted 274,000 in the week ended May 16, but remained near a 15-year low.

In other metals trade, July platinum PLN5, -0.50%  fell $6.90, or 0.6%, to $1,150 an ounce, while June palladium PAM5, -0.03%  lost 5 cents, or less than 0.1%, to $776.80 an ounce.

July copper HGN5, +0.88%  rose 2.15 cents, or 0.8%< to $2.8505 a pound.

Source: MarketWatch