Gold trades near two-week low ahead of Fed decision

The gold prices They stabilized near a two-week low on Wednesday as investors await a decision from the United States Federal Reserve (Fed) on the rate at which the central bank plans to reduce its stimulus measures to deal with the economic fallout of the pandemic. .

At 09:55 GMT, spot gold was trading little changed at $ 1,769.70 an ounce. Gold futures in the United States were down 0.1% at $ 1,771.00.

“A possible acceleration of the withdrawal of the Fed stimulus and a steeper rate curve could maintain some pressure, but as some expectations are already reflected in the price, a more aggressive movement than anticipated could send gold further down.”Said Xiao Fu, head of commodity markets strategy at Bank of China International.

The Fed is expected to announce that it will accelerate the end of its bond purchases and signal a shift to interest rate hikes next year to hedge against rising inflation.

Reduced stimulus and interest rate hikes tend to boost Treasury yields, increasing the opportunity cost of owning bullion, which does not yield interest.

The European Central Bank, the Bank of England and the Bank of Japan also have meetings scheduled this week.

Among other precious metals, silver was down 0.4% to $ 21.83 an ounce, platinum was down 1% to $ 910.39 and palladium was down 0.8% to $ 1,608.94.

With information from Reuters.