Gold holds steady as markets await Fed verdict

Spot gold was up 0.3% at $1,804.69 per ounce, as of 0707 GMT

  
Gold bars and coins are stacked in the safe deposit boxes room of the Pro Aurum gold house in Munich, Germany, August 14, 2019.

Gold bars and coins are stacked in the safe deposit boxes room of the Pro Aurum gold house in Munich, Germany, August 14, 2019.

REUTERS/Michael Dalder

Gold prices held steady near the key $1,800-per-ounce level on Wednesday as investors held back from making large bets ahead of a U.S. Federal Reserve policy decision due later in the day.

The Fed's policy statement is due at 1800 GMT on Wednesday, followed by a news conference by Chairman Jerome Powell.

Spot gold was flat at $1,798.70 per ounce, as of 1103 GMT. U.S. gold futures  eased 0.1% to $1,798.30.

"Gold prices continue their slow dance around $1,800 mark. It seems the market is unable to find a clear direction either way, and investors are awaiting the Federal Open Market Committee meeting ... there is very little volatility," Carlo Alberto De Casa, market analyst at Kinesis, said.

Gold prices fell 7% last month to register their biggest monthly decline since November 2016, following a hawkish tilt from the U.S. central bank.

Investors now will be looking out for cues on when the central bank will begin to taper its monetary support amid fast-rising prices and any view on the looming threat from the Delta coronavirus variant. 

"The majority of Fed representatives, including Fed Chair Powell, still regard this (inflation) as a transitory development," Commerzbank analysts said in a note.

"This means that hawkish surprises are not particularly likely today, especially as there will be no new projections for growth, inflation or the dot plot envisaged by the FOMC members this time."

The dollar, meanwhile, edged 0.1% higher, making gold more expensive for holders of other currencies. 

Elsewhere, silver rose 0.5% to $24.79 per ounce, after having hit its lowest level in nearly four months at $24.46 on Tuesday.

Palladium was up 0.1% at $2,610.05, and platinum rose 0.6% to $1,056.52.

(Reporting by Brijesh Patel in Bengaluru; Editing by Ramakrishnan M.) ((Brijesh.Patel1@thomsonreuters.com; Within U.S. +1 651 848 5832, Outside U.S. +91 8067493865; Reuters Messaging: Brijesh.Patel1.thomsonreuters.com@reuters.net))


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