(MENAFN- FxPro) Gold traded flat to higher on Thursday as the region looked ahead to a Federal Reserve decision on rates that has the potential to spark volatility even though such a move is widely expected before the end of the year.
On the Comex division of the New York Mercantile Exchange, gold for December delivery rose a slight 0.04% to $1,119.50 a troy ounce.
Silver for December delivery gained 0.03% to $14.890 a troy ounce.
Copper for December delivery rose 0.33% to 2.463 a pound.
On Wednesday morning, the U.S. Bureau of Labor Statistics (BLS) said its Consumer Price Index (CPI) for August fell by 0.1% on a monthly basis, amid sharp declines in energy and airfare prices. Analysts expected monthly CPI to remain unchanged from its July level. On a year-over-year basis, the Consumer Price Index increased by 0.2% following a 0.2% gain last month.
Core CPI, which strips out food and energy prices, also experienced muted gains. In August, Core CPI increased by 0.1% on a monthly basis, below analysts' expectations for a 0.2% gain. Over the last 12 months, the core reading is up by 1.8% - following a similar yearly increase in July. The reading falls slightly below the Fed's long-term targeted goal of 2% inflation. In July, the Core PCE Index, the Fed's preferred gauge for long-term inflation, stood at 1.2%.
When the Federal Open Market Committee (FOMC) releases a statement from its September monetary policy meeting on Thursday afternoon, the Fed could raise its benchmark Federal Funds Rate for the first time in nearly a decade. The rate, which banks use to lend to other institutions on overnight loans, has remained at its current level between zero and 0.25% since December, 2008.
Last month, Fed vice chairman Stanley Fischer indicated that there is good reason to believe that inflation will move higher as the temporary forces restraining it from a stronger dollar and falling energy prices continue to "dissipate further." Gold, which is not attached to dividends or interest rates, struggles to compete with high-yield bearing assets in periods of rising rates.
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