Gold prices steady as investors await Fed meeting outcome

Dec 12 2012, 10:59 IST
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Gold was little changed on Wednesday ahead of the outcome of a US Federal Reserve policy. (Reuters) Gold was little changed on Wednesday ahead of the outcome of a US Federal Reserve policy. (Reuters)
SummaryGold was little changed on Wednesday ahead of the outcome of a US Federal Reserve policy.

Gold was little changed on Wednesday ahead of the outcome of a US Federal Reserve policy meeting that investors hope will unveil more bond buying measures, supporting bullion's appeal as a hedge against inflation.

FUNDAMENTALS

* Spot gold traded nearly flat at $1,708.91 an ounce by 0034 GMT.

* U.S. gold was also little changed, at $1,708.20.

* President Barack Obama and U.S. House of Representatives Speaker John Boehner spoke by phone on Tuesday after exchanging new proposals to avert the "fiscal cliff" as negotiations intensified ahead of the end-of-year deadline.

* A Reuters poll showed that the U.S. Federal Reserve is expected to announce a new round of Treasury securities purchases at its policy meeting which concludes later in the day.

* Morale among German analysts and investors improved sharply in December on the back of encouraging U.S. Economic data, fanning hopes that Europe's largest economy will avoid recession this winter.

* Italian Prime Minister Mario Monti warned against a slide into populism on Tuesday as Silvio Berlusconi attacked his technocrat government, accusing it of failed "Germano-centric" policies that had dragged Italy into recession.

* Holdings of gold-backed exchange-traded funds edged up to 76.178 million ounces on Dec. 10, after slipping from a record high of 76.187 million ounces in the previous session.

MARKET NEWS

* U.S. stocks rose on Tuesday, led by gains in technology companies, helping the S&P 500 end at its highest level since Election Day.

* The dollar wallowed at three-month lows against the Australian currency and remained broadly under pressure on Wednesday as markets geared up for more stimulus from the Federal Reserve.

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