Gold prices firm ahead of Fed minutes

By Apeksha Nair

BENGALURU (Reuters) - Gold prices inched up early on Wednesday after two days of losses, with investors awaiting minutes from the U.S. Federal Reserve's last meeting in July for clues on the pace of potential interest rate hikes.

Spot gold inched 0.1 percent higher to $1,272.81 per ounce by 0357 GMT, after falling for two straight days.

U.S. gold futures for December delivery was down 0.1 percent at $1,278.50 an ounce.

"I think we're starting to just see further opportunistic buying," said ANZ analyst Daniel Hynes. "There's potentially a little bit of rebound into the end of the week though obviously most focus will be on the FOMC minutes this afternoon. Any indication about a potential rate hike could derail that safe-haven buying."

 

Minutes of the Federal Open Market Committee meeting are due later in the day.

Higher interest rates could boost the dollar, making commodities priced in the greenback more expensive for holders of other currencies.

The dollar edged lower in early Asian trading on Wednesday, while Asian stocks rose as North Korean leader Kim Jong Un delayed a decision on firing missiles towards Guam.

"We probably saw some of that selling that came in as tensions eased between North Korea and the United States become a bit overdone. Certainly, the underlying issues that started emerging last week are far from evaporated," ANZ's Hynes said.

Spot gold may test a resistance at $1,278 per ounce, a break above which could lead to a gain to the next resistance at $1,286, Reuters technical analyst Wang Tao said.

Among other precious metals, silver and platinum were up about 0.3 percent at $16.64 per ounce and $959.65 per ounce, respectively.

Palladium rose 0.3 percent to $888.50 after touching its lowest in over a week earlier in the session.

(Reporting by Apeksha Nair and Arpan Varghese in Bengaluru; Editing by Joseph Radford and Biju Dwarakanath)