Gold dips as Federal Reserve wipes out hopes of easing measures

Forexpros - Gold prices traded lower in Asian trading on Thursday, dipping after the Federal Reserve released the minutes of its latest monetary policy meeting that showed no new inclination to stimulate the U.S. economy.

On the Comex division of the New York Mercantile Exchange, gold futures for August delivery traded down 0.06% at USD1,574.75 a troy ounce, also a session low and down from a high of USD1,576.85 a troy ounce early during the session.

Gold futures were likely to test support at USD1,566.95 a troy ounce, the low from July 11, and resistance at USD1,601.25, the high from July 10.

In the U.S. on Wednesday, the Federal Reserve released the minutes of its June 19-20 monetary policy meeting, revealing that voting members remain willing to stimulate the economy via credit easing measures if needed, but made no real signal if the U.S. central bank were more inclined to do so despite a string of weak economic indicators.

Monetary stimulus tools, including quantitative easing, weaken the dollar in an effort to spur recovery.

Gold and the dollar trade inversely from one another, and talk the Fed is increasingly likely to loosen policy sends the dollar falling and gold rising.

The dollar shot up on news of the Fed's stance on intervening appeared largely unchanged, with a few voting members ready to stimulate but most willing to step in only if the economy takes a more pronounced turn to the south.

"A few members expressed the view that further policy stimulus likely would be necessary to promote satisfactory growth in employment and to ensure that the inflation rate would be at the Committee's goal," the Federal Reserve said in the minutes released in the U.S. on Wednesday.

"Several others noted that additional policy action could be warranted if the economic recovery were to lose momentum, if the downside risks to the forecast became sufficiently pronounced, or if inflation seemed likely to run persistently below the Committee's longer-run objective."

Elsewhere on the Comex, silver for September delivery was up 0.11% and trading at USD27.053 a troy ounce, while copper for September delivery was down 0.06% and trading at USD3.426 a pound.