Gold prices rose on Tuesday, as the decline in the dollar provided support for the metal, but caution as traders await the US Federal Reserve meeting, in which it may clarify its plans to reduce stimulus, kept trading in a limited range.
Spot gold rose 0.1% to $1,766.04 an ounce during trading.
US gold futures rose 0.2% to $1,767.20.
“The big question that needs to be answered is whether the current market uncertainty will change any potential timeline the Federal Reserve may have when it comes to announcing a reduction in its asset purchases,” said Michael Hewson, chief market analyst at CMC Markets UK. .
“More than anything else, this is likely to further push the yellow metal down.”
Gold is a hedge against inflation that may result from widespread stimulus and currency depreciation. An increase in interest rates raises the opportunity cost of holding non-returnable gold.
Giving the yellow metal a boost, the dollar fell 0.2% after reaching near a month’s peak in the previous session.
As for other precious metals, silver rose 1.3 percent to $22.53 an ounce, platinum rose 1.1 percent to $920.67 an ounce, and palladium rose 2.7 percent to $1,936.71.
The article, the rise of gold with the decline of the dollar, and amid anticipation of the “Federal Reserve” meeting, was written in Al Borsa newspaper.