Thursday, February 18, 2010

Gold Prices Fell In After Hour Trades As Fed Raises Discount Rates

Gold prices fell in the after hour trades as the Fed raised the discount rates making markets mistrustful about the buying in commodities.

The Fed statement, released after the close of Thursday's trading, said the moves were approved unanimously by the Federal Reserve Board, and would take effect on Friday, February 19th. The fed said it is increasing the so-called discount rate by 25 basis points to 0.75 percent.

COMEX Gold settled floor trading at $1118.70, down just $1.40, or 0.1%, on the Comex division of the New York Mercantile Exchange. The LOCO Gold prices were at $1108.5 per ounce up $ 1.8.

MCX Gold closed at Rs 16775 per 10 grams up Rs 19. The markets got topped at Rs 16845 per 10 grams.

The U.S. Labor Department said that jobless claims were up 31,000 last week to 473,000, more than expected.

The Labor Department also said that the producer price index was up 1.4% in January and up 4.6% from a year ago, more than expected.

The U.S. Department of Energy (DOE) said that crude oil supplies were up 3.1 million barrels last week to 334.5 million barrels. Supplies of gasoline were up 1.7 million barrels and heating oil supplies were down 1.4 million barrels.

April crude oil finished up $1.69 at $79.42, the highest close in four weeks.

Source: Bloomberg