Spot gold drops after Fed minutes; futures end lower

San Francisco (May 21)  Gold settled lower for the first time in three sessions on Wednesday as the dollar and equities staged a rebound after FOMC minutes showed the Fed discussed an array of options for raising interest rates at its policy meeting last month.

Minutes of the session said Fed staff presented several approaches to raising short-term interest rates, but said the discussion was simply "prudent planning'' and not a sign rate hikes would come any time soon.

Spot gold dropped to a session low of $1,283 an ounce after the announcement and was last down 0.3 percent at $1,290 an ounce.

Prior to the release, U.S. gold futures for June delivery settled $6.50 lower at $1,288.10 an ounce.

Global shares picked up on Wednesday, while the dollar bounced back 0.2 percent against a basket of currencies after starting the session lower.

A stronger dollar makes gold more expensive for foreign investors, who showed little interest towards the metal in the absence of major economic events.

As a gauge of investor interest, holdings of the SPDR Gold Trust, the top gold-backed exchange-traded fund, fell by 1.79 tons on Tuesday.

Palladium touched a near three-year high and platinum rose near a two-month high, as labor strikes in top producer South Africa dragged on for a 17th week and after an industry report said a shortage of both metals was set to widen this year.