Gold steady as dollar softens, investors eye Fed meeting

  • Gold steady as dollar softens, investors eye Fed meeting

Gold steady as dollar softens, investors eye Fed meeting

On the MCX, October gold futures fell by 0.88 per cent to Rs 51,319 per 10 gm, while silver December futures were at Rs 67,928 per kg.

While the "most dovish scenario of the U.S. Fed is already reflected in the price of gold", the central bank's guidance on how long it could keep rates low and average inflation forecasts are crucial, said ABN Amro analyst Georgette Boele.

Spot gold was up 0.4% to $1,964.34 per ounce at 0931 GMT, having earlier climbed to its highest since September 2 at $1,968.80.

In the worldwide markets, gold remains steady as dollar looses ahead of the US Fed monetary policy meeting that may provide further direction on the stimulus measures and inflation targets.

Jeffrey Halley, a senior market analyst at OANDA, stated, "Gold has well-denoted support between $1,900 and $1,920 an ounce, with trend line resistance at $1,970".

"The fact that gold prices remain below $2,000 even though the dollar has been under pressure in recent weeks is a signal of fatigue".

"Gold has witnessed mixed trade reflecting choppiness in equity markets and USA dollar index. We may see directionless trade continuing unless either side of $1900-2000/oz range is broken", Kotak Securities said in a note.

Market participants are now looking at the U.S. Fed's two-day policy meeting, which ends on Wednesday.

The dollar index remained steady today after a sharp fall in the previous session. A weaker U.S. dollar makes gold less expensive for holders of other currencies.

Silver eased 0.1% to $27.12 per ounce, platinum was little changed at $954.50, while palladium dipped 0.2% to $2,308.81.

"Amid other factors, gold ETF flows have also been mixed indicating lack of confidence in investors".

Gold has been one of the most consistent gainers through the six months of coronavirus pandemic-led turmoil in financial markets.

British Prime Minister Boris Johnson lashed out at the European Union on Monday as he won initial approval for a plan to breach the Brexit treaty.