Gold Off Two-Week Lows Ahead Of US Central Bank Policy Meet

Canadian dollar weekly graph

Gold Off Two-Week Lows Ahead Of US Central Bank Policy Meet

Analysts said cutting down of positions by traders in line with a weak trend overseas as the dollar firmed, with focus shifting to the US Federal Reserve's policy meeting that kicks off later in the day, weighed on gold futures. In the previous session, it touched $1,307.51 an ounce, its lowest since March 1.

The most active gold contract for April delivery went up 5.5 dollars, or 0.42 percent, to close at 1,317.8 dollars per ounce.

Public remarks by Fed officials suggest a broad shift in the committee's outlook towards a potentially faster pace of tightening, and we expect the median dot to show four hikes in 2018, up from three at the December meeting. The gold prices would be more expensive for holders of foreign currency on the robustness of dollar, while a rise in USA rates lifts the opportunity cost of holding non-yielding assets such as bullion.

Holdings at the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, holdings rose 1.26 per cent, their best one-day percentage rise since Jan 18, to 850.84 tonnes on Monday from 840.22 tonnes on Friday.

Among other precious metals, silver gained 0.1 per cent to $16.32 per ounce after matching Friday's three-month low in the previous session. Palladium dropped 0.4pc to $990.97 while platinum was up 0.5pc at $947.30 after touching its lowest since January 3 at $936.50. Palladium rose 0.4 per cent to US$993.60 per ounce.

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