NEW YORK – Gold prices fell on July 28, pressured by a stronger dollar as markets awaited the Federal Reserve’s upcoming policy decision for clues on the interest rate outlook.
Spot gold fell 0.6 per cent to US$4,051.07 per ounce by 0726 GMT (3.26pm, Singapore time) after rising as much as 1 per cent on July 27. US gold futures for August delivery lost 0.6 per cent to US$4,051.60.
The dollar held near a one-month high, making greenback-priced bullion more expensive for holders of other currencies.
“We’re oscillating in this narrow range between US$3,950 and US$4,200, and I think the market is just waiting for Fed signals,” said Ilya Spivak, head of global macro at finance content network Tastylive.
The Fed will conclude its two-day policy meeting on July 29. Expectations that it will hold interest rates steady stand at 62 per cent, while 38 per cent of market participants expect at least a 25-basis-point rate hike, according to CME FedWatch, up from 16 per cent a week earlier.
Markets are pricing in an 81 per cent chance of a hike at the central bank’s September meeting.
US President Donald Trump on July 27 called on the Fed to lower interest rates, saying the US should have the lowest interest rate in the world.
Trump also said the US was having “good talks” with Iran and there was a chance of a deal to resolve their conflict, but warned that strikes would resume if negotiations failed to deliver.
Tehran appeared to quickly test the pause in the US military campaign, with Saudi Arabia, Jordan and Iraq reporting drone attacks on July 27.
Spivak said if the Fed meeting generates language that does not set the groundwork for a rate hike in September, gold is likely to rally above US$4,200 per ounce.
Spot silver fell 1.6 per cent to US$57.48 per ounce, platinum lost 0.6 per cent to US$1,611.48 and palladium slid 1.4 per cent to US$1,274.10. REUTERS
