Gold prices at 1-1/2-week low on dollar strength as Fed meeting looms

Monday,   14-Jun-2021   09:34 AM (IST)

Gold prices slipped on Monday to their lowest in more than a week, weighed down by a stronger dollar, while investors awaited cues from the Federal Reserve policy meeting this week with recent spikes in U.S. consumer prices seen as a temporary blip. Spot gold was down 0.6% at $1,864.58 per ounce, as of 0311 GMT, its lowest since June 4. U.S. gold futures fell 0.6% to $1,867.60 per ounce. The dollar strengthened 0.1% to hover near a one-week high against its rivals, making gold more expensive for holders of other currencies. Last week, data showed U.S. consumer prices rose solidly in May. However, Fed officials have repeatedly said that inflation would be transitory and expect monetary stimulus would stay in place for some time. Focus now shifts to the Fed’s June 15-16 meeting for further clarity on the policymakers’ view on rising inflation and monetary policy going forward. Morgan Stanley in its research note on Friday said it expects the Fed at its upcoming policy meeting to lay the groundwork for increased flexibility on its quantitative easing program by “talking about talking about tapering”. Meanwhile, speculators reduced their net long positions in COMEX gold in the week ended June 8 and raised their net long positions in silver. Elsewhere, silver slipped 0.3% to $27.80 per ounce, palladium eased 0.2% to $2,771.31, while platinum dipped 0.6% to $1,143.71.