Gold Holds to Tight Bandwidth as Fed Meeting looms by


© Reuters.

By Ambar Warrick– Gold prices rose slightly on Tuesday, but remained within a tight range this week as investors held back from big bets ahead of a US Federal Reserve meeting expected to result in a rate hike.

rose 0.2% to $1,679.14 an ounce, while it rose 0.6% to $1,687.85 an ounce by 20:11 ET (00:11 GMT). Both instruments have marked muted moves since Monday after registering steep losses last week.

Pressure on gold eased slightly on Tuesday as the price fell. But prices remained close to a 20-year high as they rose ahead of a Fed rate decision.

The central bank is widely expected to do so on Wednesday, although traders are also pricing in the possibility of a surprise 100 bps increase. Expectations for a sharp rate hike by the Fed were cemented after data from last week showed US inflation stalled at its near 40-year high in August. The reading had boosted the dollar and caused extensive losses in the metal markets.

A series of rate hikes by the Fed has lifted gold from highs during the start of the Russia-Ukraine war, with the yellow metal now trading lower for the year. The gold price recently fell below the $1,700 level, which was seen as one of the last points of support for a stronger decline.

Other precious metals also rose Tuesday, with and futures both recovering from recent losses.

Among industrial metals, it rose 0.2% to $3.5323 a . But the red metal also faltered under recent pressure from the US dollar.

Signs of weakening economic growth around the world have dimmed the outlook for copper prices this year, despite expected supply disruptions from a strike at Chile’s Escondida copper mine.

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