Gold prices moved up on Wednesday, extending gains from previous session, amid optimism about increased demand for the metal as several countries plan to reopen after a prolonged lockdown due to the coronavirus pandemic.
Although the Federal Reserve has ruled out the possibility of negative interest rates, the low interest rate of 0 to 0.25%, and the central bank’s pledge that it would come out with other options available in its toolkit to boost the economy appears to be prompting investors to seek the yellow metal.
The dollar’s weakness supported the yellow metal. The dollar index, which dropped to 99.00 around mid morning, recovered to 99.25 subsequently, but faltered again and was last seen at 99.11, down 0.26% from previous close.
Gold futures for June ended up $6.50, or about 0.4%, at $1,752.10 an ounce.
Prices edged up further after the Fed released the minutes of its latest policy meeting. The minutes showed the policmakers were more explicit about the future path of interest rates.
A number of participants believed there was a substantial likelihood of additional waves of the coronavirus outbreak, which could lead to further economic disruptions.
At the same time, the minutes noted economic activity could recover more quickly if the pandemic subsided enough for households and businesses to become sufficiently confident to relax or modify social-distancing behaviors over the next several months.
Silver futures for July ended up $0.130, or 0.7%, at $18.031 an ounce, while Copper futures for July moved up 1.7% to $2.4600 per pound.