Gold steadies ahead of Fed meeting as dollar sags
Gold prices traded near a one-month high on Tuesday as the dollar languished at a more than one-year low ahead of a Federal Reserve meeting that is expected to provide more clues on U.S. monetary policy.
The market is not expecting a rate increase to result from the Fed`s two-day meeting starting on Tuesday but it is looking for hints on the timing and extent of future moves.
Spot gold eased 0.1 percent to $1,252.60 an ounce at 0916 GMT. The metal had touched $1,258.79 in the previous session, its highest since June 23.
U.S. gold futures climbed 0.1 percent to $1,257.
"The market is looking for clarity on the Fed`s tightening cycle and when they are going to start with the tapering (of monetary stimulus)," said ETF Securities analyst Martin Arnold.
Taking the shine off gold slightly, investors climbed into European equities.
The U.S. dollar hovered near a 13-month low against a basket of currencies on Tuesday, with traders not expecting the Fed meeting to alter the currency`s recent weakness.
Also supporting gold were hurdles standing in the way of U.S. President Donald Trump`s stimulus and tax reform agenda.
"There is a dual-pronged attraction to gold at the moment, with low interest rates and investors looking at the metal as a hedge against U.S. political uncertainty," Arnold said.
Gold is often seen as an alternative investment during times of political and financial uncertainty.
The Republican Party`s repeated failure to overhaul the healthcare system, multiple congressional and federal investigations into Trump`s election campaign have cast a shadow over his first six months in office.
Trump`s son-in-law, Jared Kushner, on Monday told Senate investigators he had no part in any Kremlin attempt to meddle in the U.S. election despite having met Russians four times last year.
In other precious metals, silver fell 0.5 percent to $16.37 an ounce after hitting its highest since July 3 at $16.59 in the previous session.
Platinum gained 0.4 percent to $929.80. In the previous session it touched $940.40, its highest in more than five weeks. Palladium, meanwhile, advanced by 1.3 percent to $859.10.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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