Gold prices edges down ahead of US interest rate hike expectation
Gold edges lower on Wednesday after upbeat US data supported the view that the world’s biggest economy may be strong enough for the Federal Reserve to raise interest rates next week.
A rate hike would weigh on gold, as it would raise the opportunity cost of holding bullion, which yields no interest.
Investors are now waiting for the FOMC meeting next week and that’s why the liquidation in exchange traded funds and a firm dollar put pressure on prices.
Spot gold was down 0.1 percent at $1,168.80 ounce by 0303 GMT, after ending the previous session nearly flat. US gold futures gained 0.1 percent at $1,171.20
Crude oil in reverse gear on fuel glut fears.
On Tuesday, crude oil futures plunged nearly 1 percent during afternoon trade in the domestic market as investors and speculators exited their positions in the energy commodity exited their positions in the energy commodity as crude output rises despite OPEC and Russia inked historic deal to cut crude production in 2017.
Traders have an opinion that prices fall was mainly on account of increasing output from within the Organization of the Petroleum Exporting Countries (OPEC) and Russia.
According to the survey based on shipping data and information from industry sources, OPEC oil production in November rose to 34.19 million bpd, from 33.82 in the previous month. Moreover, Russia reported its average oil production in November month of 11.21 million bpd , which its highest in almost 30 years.