MTECHTIPS;-Gold prices unchanged as the Fed’s two-day meeting kicks
MTECHTIPS;-Gold prices unchanged as the Fed’s two-day meeting kicks off
MTECHTIPS-Gold prices traded at break-even on Tuesday, after expectations that the Federal Reserve will increase interest rates on Wednesday weighed on gold, as the precious metal struggled to capitalist on a slump in the dollar.Gold futures for August delivery on the Comex division of the New York Mercantile Exchange fell $0.10 or 0.01%, to $1,268.80 a troy ounce. Gold futures traded in a narrow range, as investors held off initiating large positions in the precious metal ahead of the start of the Federal Reserve’s June meeting, which concludes on Wednesday, with the majority of traders expecting an interest rate hike. In a rising interest rate environment, investor appetite for gold weakens as the opportunity cost of holding the precious metal increases relative to other interest-bearing assets such as bonds. Investors are expected to closely monitor Fed chair Janet Yell en’s press conference for any clues on future monetary policy, and an update on the Federal Reserve’s plan to reduce its $4.5 trillion balance sheet. Investor skepticism on the pace of rate hikes has started to grow in recent weeks amid signs of cracks in the US economy, with some analysts suggesting that Wednesday’s widely expected interest rate hike could be final hike of 2017.
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