BULLION LATEST 26/07: Gold weakens as investors await FOMC statement

The spot gold price was quoted at $1,246.80-1,247.10 per oz as of 04:28 GMT, down $7.8. Trade has ranged from $1,246.75-1,257.75 so far today.

• The dollar has rebounded somewhat this morning, but remains in low ground – it was up 0.05% at 94.09 as of 05:13 BST.
• “The weaker dollar failed to ignite gold prices, with traders remaining cautious as the US Federal Reserve continued its two day meeting,” ANZ Research said on Monday.
• The FOMC’s rate decision today is unlikely to provide much support to the dollar with the market largely expecting fed funds to remain unchanged.
• The market is pricing in a 96.9% chance that the benchmark Fed funds rate remains unchanged with only slightly better odds in the September meeting.
• However, investors will be keeping a close eye on the FOMC’s statement, hoping for clues on the outlook for the US central bank’s monetary policy – with any perceived hawkish language potentially sending gold lower.
• Support for the yellow metal should still come in the form of political uncertainty in the USA, however, as investors continue to seek out haven assets.

Silver, PGMs

• In the other precious metals, the spot silver price was down $0.072 at $16.365-16.410 per oz. Platinum decreased $2.0 to $923.0-928.0 per oz, and palladium climbed $12.0 to $861.0-866.0 per oz.
• On the Shanghai Futures Exchange, gold for December delivery was recently at 274.70 yuan ($40.67) per gram, while the December silver at 3,863 yuan per kg.

Currency moves and data releases

• The dollar index was up 0.05% at 94.09 as of 05:13 BST.
• In other commodities, the Brent crude oil spot price was up 0.8% to $50.6 per barrel, and the Texas light sweet crude oil spot price rose 1.02% to $48.38.
• In equities, the Shanghai Composite was down 0.12% to 3,239.84.
• In US data, house prices rose 0.4% in May, down from a downwardly-revised 0.6% in the previous month, CB consumer confidence was up from the previous 118.9 to 121.1 and the Richmond manufacturing index was up to 14.0 for July from 7.0 previously.
• Today, the UK’s preliminary gross domestic product is due, while US data includes new home sales and crude oil inventories, the FOMC’s statement and federal funds rate decision.