WASHINGTON (dpa-AFX) - Gold futures settled at a more than 3-week high on Thursday on a weaker dollar and as investors rush to pick up the safe-haven commodity amid concerns about the spread of the Omicron variant of the coronavirus.
The Federal Reserve's announcement on Wednesday that it would raise interest rates in 2022, reduced a source of uncertainty for markets.
The Fed said it would double the speed of the tapering of its bond purchasing program and projected three rate hikes in 2022, citing rising price pressures and improvement in the labor market.
The dollar index drifted down to 95.85 and despite recovering subsequently, remained in negative territory at 96.10, down more than 0.4% from the previous close.
Gold futures for February ended higher by $33.70 or about 1.9% at $1,898.20 an ounce, the highest settlement since November 22.
Silver futures for March ended up by $0.940 or 4.4% at $22.485 an ounce, while Copper futures for March March settled at $4.305 per pound, gaind nearly 3%.
Investors also noted the policy announcements from the Bank of England and the European Central Bank. The Bank of England today raised its key interest by 0.15 percentage points as policymakers viewed that some moderate tightening is required to bring inflation down. The committee unanimously decided to maintain the bond purchase programme at GBP 895 billion.
The European Central Bank today announced a reduction in support for the euro zone economy by another notch but promised copious support for 2022. The bank also indicated that any exit from years of ultra-easy policy will be slow.
ECB President Christine Lagarde said policymakers are unlikely to raise interest rates next year after the bank unveiled plans to start tapering its stimulus in March.
In U.S. economic news today, data from the Labor Department showed initial jobless claims rose to 206,000, an increase of 18,000 from the previous week's revised level of 188,000.
The Fed also released a report showing U.S. industrial production increased by 0.5% in November after surging by an upwardly revised 1.7% in October.
A separate report from the Commerce Department showed housing starts and building permits both surged by much more than expected in the month of November.
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