June 09, 2020
Gold ticks up, moves in tight range ahead of U.S. Fed meeting
(Reuters) - Gold prices edged higher on Tuesday buoyed by a weaker dollar, but the metal traded in a narrow range as caution set in ahead of the U.S. Federal Reserve's two-day monetary policy meeting.
Spot gold was up 0.1% at $1,696.06 per ounce by 0442 GMT. U.S. gold futures eased 0.3% to $1,700.60.
"Given the enthusiasm for risk and growth exposed assets, we could see pressure come to gold during the session, but on the other hand the weaker U.S. dollar is supportive," said Michael
McCarthy, chief strategist at CMC Markets.
The U.S. dollar hovered near a three-month low, making gold cheaper for holders of other currencies.
Investors' focus is now on the U.S. central bank's two-day monetary policy meeting, starting later in the day, for any forward guidance as economy gradually starts showing signs of recovery.
Traders stopped pricing for the possibility of negative rates in the United States, following a surprisingly strong employment report last Friday.
Limiting gold's advance, market participants favoured riskier assets as confidence in an economic recovery pushed the Nasdaq benchmark to a record high. Asian stocks were also set to climb.
"The yellow metal is on a reasonably steady downtrend, most likely on the back of the great run in equity markets over the past few weeks, which could see fast money continue to sell on rallies," said Stephen Innes, chief market strategist at financial services firm AxiCorp, in a note.
Meanwhile, the World Health Organization on Monday warned that the COVID-19 pandemic is "far from over," as a record number of new daily infections were reported.
Among other precious metals, silver dropped 1.8% to $17.54 an ounce, palladium fell 0.4% to $2,015.40, and platinum eased 0.3% to $830.37.