Gold inches up as dollar eases ahead of Fed decision

Gold prices edged up on Wednesday after hitting a one-week low in the previous session, with the dollar falling against a basket of major rivals and traders awaiting the outcome of the U.S. Federal Reserve’s two-day meeting.

Spot gold had risen 0.2 percent to $1,341.15 per ounce by 0359 GM. In the previous session, it touched its lowest since Jan. 23 at $1,334.10 an ounce.

U.S. gold futures for February delivery rose 0.4% to $1,339.80 per ounce.

“Yellen may deliver a hawkish surprise setting the stage for a possible policy pivot while



trumpeting in the Powell era. Gold bears may take advantage of this move,” said Stephen Innes, APAC trading head for OANDA.

A rate hike in March would not come as a surprise, but any change in the pace of hikes would pose a risk to gold’s rally, Innes noted.

Gold prices have risen 2.8% so far in January, their best month since August, largely due to weakness in the dollar.

The dollar inched lower against a basket of major rivals on Wednesday, showing scant reaction to U.S. President Donald Trump’s State of the Union address.