Gold climbs as investors await Fed statement; silver advances

Bullion rose as much as 1%

Gold advanced as investors awaited the conclusion of U.S. Federal Reserve policy makers’ meeting today for signals on whether the Fed may start reducing its unprecedented stimulus program in the coming months.

Bullion for immediate delivery rose as much as 1 percent to $1,339.74 an ounce, and was at $1,336.65 at 10:02 a.m. in Singapore. Prices have advanced 8.3 percent in July, snapping a run of three monthly losses and heading for the best gain since January 2012.

Gold fell 20 percent this year amid speculation the Fed, which buys $85 billion of assets a month, may start to taper the program as the U.S. economy improves. While none of the 54 economists surveyed by Bloomberg July 18-22 expected the Federal Open Market Committee to begin paring purchases at this meeting, half predicted a reduction to $65 billion per month in September. A statement is due from the FOMC at 2 p.m. in Washington.

“Gold can move by $50 an ounce either way tonight, depending on what the Fed is going to say,” said Steven Dooley, head of research at Forex Capital Trading Pty in Melbourne. “What we are looking for is some kind of guidance on the Fed’s tapering. Other numbers like GDP or job data pale in comparison to the Fed.”

U.S. gross domestic product probably climbed 1 percent in the second quarter, after expanding 1.8 percent in the first three months of 2013, according to the median of 84 estimates compiled by Bloomberg before data due today. Payrolls data, to be released Aug. 2, will show employers added 185,000 workers in July, after increasing 195,000 in June, a separate survey shows.

Gold for December rose as much as 1.1 percent to $1,339.70 an ounce on the Comex, and traded at $1,334.80. Assets in the SPDRGold Trust, the largest bullion-backed exchange-traded product, were unchanged at 927.35 metric tons as of July 30.

Silver for immediate delivery gained as much as 1.4 percent to $20.0118 an ounce and was at $19.9497. The metal is heading for the first monthly advance since January.

Platinum climbed 0.6 percent to $1,444.65 an ounce, and palladium rose 0.8 percent at $735.70 an ounce. Both are set for monthly climbs.

www.bloomberg.com

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Copyright 2014 Bloomberg. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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