The Federal Reserve could start tapering its $85 billion -a-month asset purchase plan by the summer, said John Williams, president of the Federal Reserve Bank of San Francisco on Wednesday. The central bank has said it would continue the purchase program until it sees substantial improvement in the labor market.
"Assuming my economic forecast holds true, I expect we will meet the test for substantial improvement in the outlook for the labor market by this summer," Williams said. "If that happens we could start tapering our purchases then. If all goes as hoped, we could end the purchase program sometime late this year," he added.
In his remarks, Williams said he is “hopeful that the economy has finally shifted into higher gear.” He forecast the economy would grow at a 2.5% rate this year and pick up to a 3.25% rate in 2014. This will bring down the unemployment rate below 7% by late 2014, he said.
Gold for June delivery are trading down $8.8 at $ 1544.7 an ounce on the Comex division of the New York Mercantile Exchange. Yesterday it fell $22.40, or 1.4%, to settle at $1,553.50 an ounce. That was the lowest settlement for a most-active contract since June 28.
Asian markets were down Thursday tracking a negative lead from Wall Street, with a stronger yen hitting the Japanese market ahead of the Bank of Japan’s meeting outcome. Investors are also awaiting the European Central Bank’s policy decision due later Thursday, as well as Friday’s U.S. jobs data for trading cues.
U.S. stocks fell sharply Wednesday, with the benchmark indexes taking their worst hit in more than five weeks, after labor-market data disappointed ahead of Friday’s nonfarm payrolls report. After a 136.65-point drop, the Dow Jones Industrial Average finished at 14,550.35, down 111.66, or 0.8%.
MCX April gold futures may open today’s session near Rs 29220 levels with support near Rs 29100 levels. Yesterday, it ended down 1.24 % at Rs 29238 per 10 grams.
Source by Commodity Insights
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