Shafaq News/ On Wednesday, Gold prices were headed for their first monthly dip in four as investors tempered their bets of swift and deep U.S. rate cuts in the light of a resilient economy, ahead of the Federal Reserve's monetary policy decision later in the day.
Spot gold was flat at $2,036.10 per ounce by 0719 GMT after touching a two-week high of $2048.12 in the previous session. Prices have dropped 1.3% so far this month.
U.S. gold futures rose 0.1% to $2,033.30.
"Gold's seasonal rally seemed to have arrived early, so it's not too much of a surprise to see it struggle this January ... traders are slowly coming around to a less-dovish Fed than they had hoped for in December," said Matt Simpson, a senior analyst at City Index.
Traders are pricing in about 130 basis points (bps) of Fed rate cuts for 2024, down from more than 160 bps bets at the end of 2023, according to LSEG's interest rate probability app IRPR.
The chances of a March rate cut have dropped to 44% from about 90% a month ago.
The dollar index (.DXY) was on track to mark its best month since September, with an increase of more than 2% so far in January.
Yields on benchmark U.S. Treasury notes were at a two-week low of 4.0203%, but still higher than the year-end close of 3.8600%.
"With renewed hopes of a truce in Gaza, today's FOMC meeting runs the risk of disappointing doves and weighing on gold," said Simpson.
The two-day FOMC, or Federal Open Market Committee, meeting ends later today. While the Fed is expected to leave rates unchanged, Chair Jerome Powell's news conference at 1930 GMT will be parsed for cues on rate cuts down the line.
Spot silver prices dropped 0.4% to $23.07 per ounce, while platinum slipped 0.3% to $918.36, and palladium was steady at $976.07. All three were poised for a monthly decline.
(Reuters)