Gold Is ‘Treading Water’ as Investors Await Fed Meeting

Gold steadied near a four-week low as investors awaited the conclusion of the Federal Reserve’s two-day meeting for clues on monetary policy.

Markets are watching to see whether the Fed will start discussions about scaling back unprecedented support for the economy -- though analysts say actual steps in that direction are likely still months off. Higher interest rates curb the appeal of the non-interest-bearing metal.

“Gold is treading water” ahead of the Fed meeting, Ole Hansen, head of commodity strategy at Saxo Bank A/S, said by email. “While no change in policy is expected, Fed officials will release of a new set of policy and economic forecasts in which they could project interest-rate liftoff in 2023.”

Gold has been buffeted by worries over the outlook for monetary policy after reaching an almost five-month high in early June. Fed officials could project an interest-rate increase in 2023, but they won’t signal scaling back bond purchases until August or September, according to economists surveyed by Bloomberg.

Gold Is ‘Treading Water’ as Investors Await Fed Meeting

Spot gold was little changed at $1,859.67 at 1:39 p.m. in New York. Prices slumped to $1,844.92 on Monday, the lowest intraday level since May 17. Futures for August delivery on the Comex rose 0.3% to settle at $1,861.40. Spot silver and palladium rose, while platinum fell.

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