Yahoo Finance Gold Prices Dip but Hold above $1,200 before Fed Decision
Investing.com - Gold prices slipped lower on Wednesday, but held above the psychologically important $1,200 level , as investors awaited the conclusion of the Federal Reserve meeting later in the day, when it was widely expected to deliver its third rate hike this year.
December gold futures were down $2.20 or 0.19% to $1,203.90 by 07.15 AM ET (11.15 GMT) on the Comex division of the New York Mercantile Exchange.
Gold slid as the dollar edged higher, with the U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, rising 0.14% to 93.86.
Prices of the yellow metal looked likely to remain rangebound until after Wednesday’s Fed announcement, when it is widely expected to raise interest rates by a quarter of a percentage point to 2.25% and offer some clues on the future path of monetary policy.
Higher interest rates increase bond yields, making non-interest bearing gold less attractive to investors. They also tend to boost the dollar, making dollar-denominated gold more expensive for holders of other currencies.
With the rate hike fully priced in and investors also expecting another rate hike in December attention will be turning to the Fed’s plans for the direction of monetary policy in 2019.
Indications that the Fed is looking to remain hawkish next year would likely bolster the dollar, while suggestions that it may slow the pace of rate hikes or that it is coming to the end of its tightening cycle next year could send the greenback lower.
Overall market sentiment remained subdued after U.S. President Donald Trump’s appearance at the United Nations General Assembly on Tuesday, where he restated his administrations tough stance on trade saying that his country would "no longer tolerate abuse" on that front.
Elsewhere in metals trading, December silver edged up 0.19% to $14.51 a troy ounce, while January platinum was trading at $829.70, up 0.42% for the day.
Among base metals, December copper added on 0.19% to trade at $2.82.
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