Gold Edges Higher to $4,149.70 on Middle East Uncertainty, Fed Rate Expectations

Gold prices rose Wednesday as conflicting reports over a potential U.S.-Iran peace deal kept Middle East risk premiums elevated, while traders weighed expectations the Federal Reserve will hold rates steady at its October 27-28 meeting. Front-month Comex gold for December delivery gained $7.10, or 0.17%, to $4,149.70 per troy ounce. December silver fell $0.325, or 0.56%, to $57.675 per troy ounce. Conflicting signals clouded the outlook: Al-Araby Al-Jadeed reported Pakistan and Qatar proposed a resolution, with the U.S. agreeing to release frozen Iranian funds and Iran permitting IAEA inspections. But a diplomat involved in the talks said reports a deal was close were wrong. Iran's foreign minister said the Strait of Hormuz would remain closed until U.S. conditions are met, and Secretary of State Marco Rubio said a deal remains difficult. A Reuters poll of 100 economists found 94 expect the Fed to hold rates at 3.75%-4.00% in October, though all anticipate a quarter-point increase in December. Investors await Thursday's jobless claims and Friday's Flash PMI data. Separately, the Bank of Russia said it sold 200,000 troy ounces of gold in September, cutting holdings to 72.80 million troy ounces.