Gold Prices Finish With Solid Gain

Updated from 11:19 a.m. ET with settlement prices, FOMC minutes and Obama press conference

NEW YORK ( TheStreet) -- Gold prices were higher Wednesday as minutes of the Federal Reserve's most recent policy meeting indicated the central bank's stimulus efforts are likely to continue in 2013.

Gold for December delivery rose $5.30 to settle at $1730.10 an ounce at the Comex division of the New York Mercantile Exchange. The gold price traded as high as $1,734.10 and as low as $1,720.50 an ounce, while the spot price was rising $1.60, according to Kitco's gold index.

" These small moves are just digestion ... investors are making a decision. We had the election to push things off for a while, we had the open ended QE -- it's good because it shows the Fed would support the market," said Yoni Jacobs, chief investment strategist at Chart Prophet. "On the other hand, open ended means there are no more quantitative easing announcements to boost the market."

The Fed implemented an open-ended, mortgage-backed security purchasing program in September as a form of monetary stimulus to theoretically push investors out of ultra-safe Treasury bonds into other assets, such as equities and risky, low-quality credit, high-yield corporate bonds. The move, the Fed has argued, should encourage investment in other areas to help spur economic growth.

Increasing the money supply is viewed as a net positive for gold, which is seen as a safe haven against inflation.

"Looking ahead, a number of participants indicated that additional asset purchases would likely be appropriate next year after the conclusion of the maturity extension program in order to achieve a substantial improvement in the labor market," the Federal Open Market Committee minutes said.

Investors have also continued to monitor events in Europe as European finance ministers have been expected to reach an agreement on a fresh disbursement of emergency loans to Greece. The Greek parliament passed an austerity package over the weekend. Spain has also continued to vex markets as the nation's banks have struggled with liquidity. For weeks onlookers have anticipated Spain would ask for a bailout from the European Central Bank, but have received silence on the issue.

Japan on Sunday night issued its latest GDP figures, which showed the country dipping back into a recession. The negative economic news could force the Bank of Japan to provide more stimulus to the country, though it's difficult to predict how much the central bank's intervention will affect global gold futures.

Japan's last round of easing on Sept. 19 caused the yellow metal to bump higher in the immediate aftermath, only to relinquish most of those early gains by the time it settled that day in New York.

The United States' so-called fiscal cliff -- the event when automatic deep spending cuts and an expiration of the Bush tax cuts and other tax cuts occurs -- has also left a question mark above investors heads.

President Barack Obama said in a press conference on Wednesday that he was willing to work with House Republicans and Senate Democrats to avert the fiscal cliff.

"I believe this is solvable," Obama said. "I think that fair-minded people can come to an agreement that does not cause the economy to go back into recession, that protects middle class families."

In the meantime, the uncertainty, according to some analysts, is generally a positive for gold prices.

Gold mining stocks were mostly lower Wednesday. Shares of NovaGold Resources ( NG) were slumping 6.9%, and AngloGold Ashanti ( AU) were decreasing 3.9%.

Among volume leaders, Kinross Gold ( KGC) was shedding 3.6%, and Barrick Gold ( EGO) was off 3.5%.

Gold ETF SPDR Gold Trust ( GLD) was down 0.05%, and iShares Gold Trust ( IAU) was losing 0.06%.

-- Written by Joe Deaux in New York.

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