Gold Slips As Dollar Gains, Investors Focus On Fed Meeting

By Mubasher

Gold prices fell on Friday, as a stronger US dollar weighed on the precious metal which was heading to post its largest fall in five weeks.

By 8:27 am GMT, US gold futures fell 0.37% to $1,242.80 per ounce, while spot gold dipped 0.32% to $1,238.02 per ounce.

No immediate risks are seen until now, so some investors are holding on to their positions in the yellow metal and not liquidating, Singapore-based dealer GoldSilver Central managing director Brian Lan told Thomson Reuters.

“Dollar has also strengthened a little,” Lan said, while not expecting “gold to do much unless there’s something on the Fed decision [on interest rate hikes].”

The US dollar index, which traces the greenback against a basket of six peers, went up 0.24% to 97.2940, as investor turned their attention to an expected US interest rate hike next week.

“Market sentiment towards zero-yielding gold is at risk of souring ahead of the Fed meeting next week where interest rates are expected to be hiked,” FXTM research analyst Lukman Otunuga told Reuters.

However, as the Federal Reserve likely to put interest rate increases on hold next year, the precious metal would stand on a solid ground to some degree, Otunuga said.

This article provided by NewsEdge.