Dollar Strengthens, Gold Falls Ahead of Fed Decision
Gold prices weakened in Tuesday's trading ahead of the Federal Reserve's interest rate decision. Spot gold fell 0.8% to US$4,041.12 per troy ounce.
Pressure on gold came from the US dollar, which remained near its highest level in a month. A stronger dollar makes gold more expensive for buyers using other currencies.
The market widely expects the Fed to keep interest rates unchanged at the conclusion of its meeting on Wednesday. However, the chance of a rate hike this week remains around 40%.
Expectations for a September rate hike have even reached around 80%. Higher interest rates typically pressure gold because the precious metal offers no yield.
Investors also reduced positions ahead of the release of second-quarter US economic growth data and PCE inflation data. Meanwhile, a lull in the US-Iran conflict and falling oil prices helped ease concerns about energy inflation.
Silver fell 1.6% to US$57.48 per troy ounce, while platinum weakened 0.6% to US$1,612.60. Gold has the potential to remain within a range of movements until the market receives clearer guidance from the Fed regarding the next interest rate direction. (asd)*
Source: Newsmaker.id
