|
CHICAGO, Dec. 1 (Xinhua) -- Gold futures on the COMEX division of the New York Mercantile Exchange fell on Thursday as traders adjusted positions ahead of the December Federal Open Market Committee (FOMC) meeting. The most active gold contract for February delivery fell 4.5 U.S. dollars, or 0.38 percent, to settle at 1,169.40 dollars per ounce.
Investors spent much of the day focusing on re-configuring their positions as they believe the Fed may raise rates from 0.50 to 0.75 during the December FOMC meeting.
According to the CME Group's Fedwatch tool, the current implied probability of a hike from 0.50 to at least 0.75 is at 99 percent at the December meeting and 99 percent for the February meeting.
Analysts believe Fed intends to soak up some of the banks' 2.5 trillion U.S. dollars of excess reserves as the U.S. economy continues to recover.
Banks become more willing to take risks in a bullish economy, and as a result could potentially release some of their excessive reserves, flooding the economy with cash, causing inflation, which the U.S. Federal Reserve seeks to control.
The U.S. dollar weakened on technical falling. The U.S. Dollar Index, a measure of the dollar against a basket of major currencies, fell by 0.5 percent to 101.02 as of 1945 GMT.
Gold and the dollar typically move in opposite directions, which means if the dollar goes up, gold futures will fall as gold, measured by the dollar, becomes more expensive for investors.
Silver for March delivery added 2.4 cents, or 0.15 percent, to close at 16.506 dollars per ounce. Platinum for January delivery rose 1.4 dollars, or 0.15 percent, to close at 911.30 dollars per ounce.
