Gold rises slightly as investors keep an eye on Iraq

Gold futures on the COMEX division of the New York Mercantile Exchange Tuesday rose slightly Wednesday as Iraqi government forces fought with militants for control of a main oil refinery, parts of which were in flames Wednesday.

The most active gold contract for August delivery rose 70 U.S. cents, or 0.06 percent, to settle at 1,272.7 dollars per ounce.

But shortly after the floor trading of gold was closed, U.S. Federal Reserve said after concluding a two-day policy meeting that it may increase short-term interest rates at a faster pace in 2015 and 2016. The central bank also said it would cut its bond- buying program by another 10 billion dollars, thus keeping the program on track to be completed before the end of the year.

In response to the Fed announcement, gold dropped slightly in electronic trading.

Market analysts believe that gold had already priced in the Fed meeting results and that's why light buying is happening after the Fed's announcement. Gold may also find support from platinum and palladium, as the prices of the two metals jumped Wednesday on expectations that strikes at South African mines might continue.

Silver for July delivery gained 4.6 cents, or 0.23 percent, to close at 19.778 dollars per ounce. Platinum for July delivery climbed 7.7 dollars, or 0.53 percent, to close at 1,450.8 dollars per ounce.