Gold Up, Fed Meeting on Investors' Radar

© Reuters.

By Gina Lee

AiVIF.com – Gold was up on Monday morning in Asia, alongside a U.S. dollar that is holding firm and investors looking ahead to the U.S. Federal Reserve’s policy decision, to be delivered by the Federal Open Market Committee (FOMC) later in the week.

Gold futures were up 0.28% to $1,806.90 by 12:52 AM ET (4:52 AM GMT), slightly above the $1,800 per-ounce psychological level. The dollar, which usually moves inversely to gold, inched down on Monday morning but remained near multi-month highs.

The FOMC is widely expected to make few changes to the Fed monetary policy when it meets tomorrow, with the decision to be handed down a day later. Investors, however, will be on the lookout for clues as to when the Fed would take a more hawkish stance via asset tapering and interest rate hikes.

On the data front, data from the U.S., released on Friday said the manufacturing purchasing managers’ index (PMI) was a better-than-expected 63.1, while the services PMI was lower than expected at 59.8, in July. In Asia, Japan released its own services PMI earlier in the day.

Meanwhile, in Europe, a growing number of countries increased their defenses against rising numbers of COVID-19 cases involving the Delta variant and are working to boost their immunization rates.

Physical gold demand in India, a major gold hub, was patchy during the past week as price volatility deterred buyers, in turn forcing dealers to raise discounts to their highest levels in nearly a month to encourage purchases.

Investors also raised their net long positions in COMEX gold in the week ended Jul. 20, according to data from the U.S. Commodity Futures Trading Commission.

In other precious metals, silver edged up 0.1%, while palladium and platinum were flat at $2,671.77 and $1,061.55 respectively.