Gold Futures Settle Higher As Dollar Loses Ground

Gold futures settled higher on Wednesday, extending gains to a fourth straight session, as the dollar shed ground against other currencies.

Fears of a global recession drove investors to pick up the safe-haven blue metal.

The dollar index, which dropped to 103.83 in the Asian session, rallied to 104.28 later on, cutting down its joss to less than 0.2%.

The Federal Reserve released the minutes of its December monetary policy meeting a little while ago. The minutes reinforce expectations the central bank is likely to continuing raising interest rates.

The minutes reiterated that officials continue to anticipate that ongoing rate increases would be appropriate to achieve the Fed’s dual objectives of maximum employment and price stability.

Gold futures for February ended higher by $12.90 or about 0.7% at $1,859.00 an ounce.

Silver futures for March ended down $0.272 at $23.964 an ounce, while Copper futures for March settled at $3.7405 per pound, down $0.0260 from the previous close.

In U.S. economic news, the Institute for Supply Management released a report showing U.S. manufacturing activity contracted at a slightly faster rate in the month of December.

The ISM said its manufacturing PMI edged down to 48.4 in December from 49.0 in November, with a reading below 50 indicating a contraction. Economists had expected the index to slip to 48.5.

Manufacturing activity contracted for the second consecutive month after expanding for 29 straight months, with the manufacturing PMI falling to its lowest level since hitting 43.5 in May 2020.