3 months ago
Commodities

Gold Prices Hold Steady as Fed Meeting Begins

Investing.com - Gold prices were little changed on Tuesday as traders turned their attention to this week’s Federal Reserve monetary

Investing.com - Gold prices were little changed on Tuesday as traders turned their attention to this week’s Federal Reserve monetary policy meeting.

At 10:34 AM ET (15:34 GMT), gold futures for February delivery on the Comex division of the New York Mercantile Exchange slipped 70 cents, or 0.06%, to $1,251.10 a troy ounce.

Policymakers kicked off their two-day meeting on Tuesday and are widely expected to follow through with a fourth and final rate hike this year.

Investors will focus on updated economic projections, particularly the dot plot that lays out expectations for rates and the post-policy meeting press conference by Fed Chairman Jerome Powell. Concerns about the outlook for global growth along with trade tensions and market volatility have prompted traders to push back expectations on the expected pace of Fed rate hikes in 2019.

While policymakers previously pointed to three increases next year, the market is starting to bet the U.S. central bank may halt its rate hikes altogether as risks to the U.S. economy mount.

A slower pace of rate increases should lessen the pressure on non-yielding bullion.

What may ironically affect the Fed’s decision is the fact that U.S. President Donald Trump took a shot at the Fed again on Monday, saying in a tweet that “it is incredible” that the central bank was “even considering yet another interest rate hike” given “the very strong dollar and virtually no inflation” while the “outside world (is) blowing up around us.”

“This loud and constant criticism puts the Fed in an awkward, equally unprecedented position. It cannot now forgo an interest rate hike at the meeting, even if the central bank thought it best, because it would then look like Trump had bulldozed the policymakers into submission,” Investing.com analyst Darrell Delamaide commented.

In other metals trading, silver futures edged down 0.03% at $14.755 a troy ounce by 10:35 AM ET (15:35 GMT).

Palladium futures gained 0.37% to $1,186.40 an ounce, while sister metal platinum lost 0.38% at $792.90.

In base metals, copper traded down 2.09% to $2.697 a pound.