Gold Price Holds Near One-Month Low as Investors Ponder Fed Rate Rise

London (Nov 4)  Gold held near a one-month low as investors added to bets of a U.S. interest-rate increase this year before a speech by Federal Reserve Chair Janet Yellen.

Bullion for immediate delivery rose 0.1 percent to $1,118.83 an ounce by 10:48 a.m. in London, according to Bloomberg generic pricing. Prices sank to $1,114.56 on Tuesday, the lowest since Oct. 2. Investors raised the odds of a December rate increase to 52 percent, 2 percentage points higher than Tuesday.

Gold fell in the past five quarters amid debate on when rates will rise. Yellen will address the House Financial Services Committee on Wednesday. Fed Vice Chairman Stanley Fischer and New York Fed President William C. Dudley will also speak Wednesday. The trio of appearances follows an unexpectedly upbeat message from the Federal Open Market Committee on Oct. 28.

“With only six weeks to go, the focus will be very much on incoming U.S. data in order to decipher what the FOMC intend to do on Dec. 16,” Ole Hansen, an analyst at Saxo Bank A/S in Copenhagen, said by e-mail. “I could see the market movements slow down as traders now look for further guidance.”

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Payrolls data on Friday will offer clues on the timing of a rate increase. The consensus for October payrolls is 182,000, beating the 142,000 a month earlier, according to a Bloomberg survey. The unemployment rate is projected to hold at 5 percent.

Gold for December delivery on the Comex in New York climbed 0.3 percent to $1,117.90 an ounce. Holdings in exchange-traded funds fell by the most in two months, dropping 0.4 percent to 1,530.7 metric tons, according to data compiled by Bloomberg.

Platinum for immediate delivery climbed 0.2 percent to $964.20 an ounce and palladium rose 0.6 percent to $648.95 an ounce. Silver traded little changed at $15.2875 an ounce.

Glencore Plc sold a share of its future silver output in a deal that includes a $900 million upfront payment, as the trading and mining company works to cut its $30 billion debt pile

Source: Bloomberg