🔴 LIVE: The Secrets of ProPicks AI Success Revealed + November’s List FREEWatch Now

PRECIOUS-Gold dips to six-week low on firm dollar ahead of U.S. Fed meet

Published 2018-05-01, 03:29 a/m
© Reuters.  PRECIOUS-Gold dips to six-week low on firm dollar ahead of U.S. Fed meet
XAU/USD
-
XAG/USD
-
DX
-
GC
-
SI
-
PA
-
PL
-
DXY
-

* Investors cautious ahead of Tue-Wed FOMC meeting - analysts

* U.S. extends tariff exemption by 1 month for major allies (Adds quote, updates prices)

By Eileen Soreng

BENGALURU, May 1 (Reuters) - Gold prices fell to a six-week low on Tuesday as the dollar firmed near 3-1/2-month highs, with investors awaiting direction on U.S. monetary policy from the U.S. Federal Reserve.

Spot gold XAU= was down 0.3 percent at $1,310.77 per ounce at 0716 GMT. Prices hit $1,310.01 earlier in the session, their lowest since March 21.

U.S. gold futures GCcv1 for June delivery declined 0.5 percent to $1,313.10 per ounce.

"The recent U.S. dollar revival has negatively impact gold as the intensity of the USD correction has caught most traders by surprise," said Stephen Innes, APAC trading head at OANDA.

The dollar index .DXY edged up 0.1 percent to 91.961 as investors awaited the Fed's policy decision and key employment data due this week for fresh clues on the strength of the U.S. economy.

While the U.S. central bank is widely expected to stand pat on policy, market participants will be closely watching the two-day meet concluding on Wednesday for hints of an interest rate hike in June. USD/

The greenback touched its highest since Jan. 11 at 91.986 on Friday. It climbed 2 percent in April, recording its biggest monthly gain since November 2016.

"Investor are also remaining cautious ahead of this week's two day FOMC meeting," said analysts at ANZ in a note.

Higher interest rates tend to boost the U.S. dollar and push bond yields up, pressuring gold prices by increasing the opportunity cost of holding non-yielding bullion.

"Support-wise (in gold), we are nearing some key technical levels with the 200 DMA at $1,304 and the psychological $1,300 level below that, expect broad support between $1,300 and the overnight low of $1,310," MKS PAMP said in a note.

Meanwhile, U.S. stock futures edged up and Australian shares hit seven-week highs after the United States extended the deadline for imposing steel and aluminium tariffs on imports from Canada, the European Union and Mexico, and offered permanent exemptions for several other allies. MKTS/GLOB markets in Asia are closed for a Labour Day holiday.

Among other precious metals spot silver XAG= fell 0.4 percent to $16.24 per ounce. Prices touched their lowest in about a month, at $16.18, in the previous session.

Platinum XPT= was down 0.2 percent at $901.50 per ounce. Prices fell to $896.50 earlier in the session, their lowest since Dec. 18, 2017.

Palladium XPD= fell 0.7 percent to $958.00 per ounce. Prices touched a near three-week low of $955.72 earlier in the day.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.