Gold fell on the daily chart at 08:20 GMT, but speculations for further bullishness remains intact, after the Federal Reserve noted, throughout January's 26 rate decision, the need for stimulus measures to cut unemployment and boost growth in the world's leading economy.
Gold for immediate delivery fell to trade at 1,341.70 an ounce, compared with the opening levels of 1,345.77 an ounce where the metal set the highest so far at 1,347.82 an ounce and the lowest at 1,339.73 an ounce. Gold Futures rose by 0.60 percent, or $8.0000 to trade at $1,342.500 an ounce
Major Market Movers
The Federal Reserve decided to leave the key lending rate unchanged during the first rate decision in 2011, at 0.25 percent, where the vote came unanimous, adding that the QE2 worth $600 billion that was announced earlier in November 2010 will remain intact.
The FOMC predicts interest rates to remain low for an extended period as the Fed sees economic improvement and progress towards accomplishing goals disappointingly slow, since the recovery is seen as insufficient to reduce unemployment levels, where production and employment remain low and weak respectively.
The economic calendar holds confidence data from Europe, Durable goods report from the US along with housing sector conditions, therefore, volatility is expected in trading, but the general trend for the metal continues to be to the upside
A report showed that assets in exchange-traded platforms (ETP) fell by 31.0 metric tons, reaching 2,043.09 tons, marking the biggest drop in two-years. The IMF said Tuesday that global growth will hover near 4.4 percent this year, compared with earlier outlook that suggested an expansion of 4.2 percent.
The Standard Chartered PLC report on commodities, released Tuesday stated that Strong economic data has improved confidence about the global outlook and reduced the need to hold gold and silver as a safe haven against credit risk, event risk and currency weakness, adding that We expect further weakness in both markets.
Gold Fixes & Dollar's Movement:
Talking about metal Fixes (Jan 26), Gold fixes at AM Fix was set at $1,335.50 an ounce, while the PM Fix was set at $1,328.00, meanwhile silver fixing was set at $27.100000 an ounce and Platinum AM Fixing was set at $1,800.00 an ounce, reaching 1,791.00 by PM fixing, finally the Palladium AM fixing was set at $797.00 at the AM fixing while being set by PM fixing at $790.00 an ounce.
The US dollar index, which tracks the performance of the dollar against six-majors, rose on the daily scale to trade at 78.02, compared with the opening levels of 77.74 where it managed to reach a low of 77.63 and a high of 78.06.
Silver for immediate delivery traded lower due to the inverse relationship between commodities and the Dollar. Silver traded at 27.39 an ounce, compared with the opening levels of 27.60 an ounce, while setting a high of 27.79 an ounce and a low of 27.33 an ounce. Silver future contracts traded higher by 0.86% or 0.232 to trade at 27.360 an ounce
Platinum for immediate delivery traded lower by $5.50, at $1,801.00 an ounce, Palladium dropped by $3.00 to trade at $808.00 an ounce.