Forexpros – Gold futures were up for a second day on Wednesday, as concerns over the global growth outlook boosted the appeal of the precious metal, while investors awaited the outcome of the Federal Reserve’s monetary policy meeting later in the day.
On the Comex division of the New York Mercantile Exchange, gold futures for October delivery traded at USD1,811.25 a troy ounce during late Asian trade, gaining 0.24%.
It earlier rose as much as 0.45% to trade at USD1,815.25 a troy ounce, the highest price since September 19.
The Fed’s Open Market Committee was to conclude its two-day policy meeting later in the day, amid speculation that the central bank could introduce fresh stimulus measures to boost U.S. economic growth.
Many market participants expect the Fed to opt for a move known as ‘Operation Twist’, a combination of buying and selling of shorter and longer term Treasury bonds in order the bend the yield curve.
Gold futures found further support after the International Monetary Fund on Tuesday downgraded its global growth outlook for 2012 to 4% from a previous estimate of 4.3%, saying that the world economy has entered a “dangerous new phase”.
The IMF revised down its forecast for U.S. economic growth to 1.5% for the rest of 2011 and 1.8% in 2012, down from its June estimate of 2.5% and 2.7% respectively.
Growth estimates for the euro zone were also revised down, with the IMF citing the ongoing sovereign debt crisis in the single currency bloc.
Greek Finance Minister Evangelos Venizelos said on Tues that “good progress” had been made in a second round of talks with the European Union and International Monetary Fund and added that talks would continue this weekend.
Gold is often seen as an alternative currency in times of global economic uncertainty and a refuge from financial risk.
Elsewhere on the Comex, silver for December delivery eased up 0.08% to trade at USD40.18 a troy ounce, while copper for December delivery jumped 1.64% to trade USD3.769 a pound.
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