Gold ended slightly higher in choppy trade on Wednesday after the minutes of the Federal Reserve's June meeting showed many officials wanted more reassurance the job market was on solid ground before withdrawing economic stimulus.
The metal rose as much as 1.3 percent, extending its gain to a third day. Bullion failed to maintain earlier gains despite the usual bullish drivers of a tumbling dollar and rallying U.S. crude futures.
Gold turned higher after the minutes of the Fed's latest policy meeting suggested that it might not be as sure a bet that the U.S. central bank will scale back its asset buying any time soon.
Prior to Wednesday, financial markets had largely reached a consensus on September as the probable start of a reduction in the pace of the U.S. central bank's $85 billion in monthly bond purchases.
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"As gold is reacting positively after the Fed minutes, it's evident that QE is going to extend for a considerable period of time," said Jeffrey Sica, chief investment officer of Sica Wealth, which has over $1 billion assets under management.
Spot gold was recently up 0.3 percent to $1,252.63 an ounce, having set a one-week high of $1,265.01.
Gold futures for August delivery settled up $1.50 to $1,247.40 prior to the Fed minutes. Volume was at 192,000 lots, about 5 percent below its 30-day average, preliminary Reuters data showed.
A downgrade of Italy's sovereign credit rating by ratings agency Standard & Poor's on Tuesday underpinned some safe-haven demand, traders said.
Disappointing performance of U.S. 10-year Treasuries prices, or rising bond yields, also weighed on gold, said George Gero, vice president of RBC Capital Markets.
As gold pays no interest, the rise in returns from U.S. bonds is seen as negative for the metal.
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