Off The Wire
PRECIOUS-Gold gains as dollar softens ahead of Fed meeting
* Fed policy announcement on Wednesday
* Platinum hits near one-month high
* Interactive graphic tracking global spread of coronavirus: open in an external browser (Updates prices, adds comment) By Nakul Iyer Sept 15 (Reuters) - Gold rose to its highest in nearly two weeks on Tuesday, propelled by a softer dollar and expectations the U.S. Federal Reserve will reinforce its accommodative monetary policy.
Spot gold rose 0.6% to $1,968.94 per ounce by 1157 GMT, having earlier climbed to $1,971.71, its highest since Sept. 2. U.S. gold futures rose 0.7% to $1,977.10 per ounce.
"The dollar weakness is playing its part but also some anticipation of continued support from the FOMC (Federal Open Market Committee) has helped the market," said Saxo Bank analyst Ole Hansen, adding that gold lacked an immediate catalyst to push it higher.
The dollar index slipped, making gold more attractive for buyers holding other currencies, as participants awaited the Fed's two-day policy meeting ending on Wednesday. While the "most dovish scenario of the U.S. Fed is already reflected in the price of gold," the central bank's guidance on how long it could keep rates low and average inflation forecasts are crucial, said ABN Amro analyst Georgette Boele. Unprecedented monetary stimulus packages and a low interest rate environment have led bullion to gain 29.7% so far this year and scale record highs above $2,000 an ounce, as it is seen as a hedge against inflation and currency debasement. "The fact that gold prices remain below $2,000 even though the dollar has been under pressure in recent weeks is a signal of fatigue ... ETF (Exchange Traded Fund) positions are at extreme levels and speculators seem hesitant to increase substantially their positions," ABN Amro's Boele said.
Elsewhere, platinum rose 1.4% to $967.14 per ounce,
after hitting its highest since Aug. 18 at $968.75.
Platinum could outperform gold by about 10%, if the World
Platinum Investment Council's forecasts for a supply deficit
comes to pass and the gold to platinum ratio breaks out of the
2.02-2.20 range, said Saxo Bank's Hansen. Silver gained 1.2% to $27.49 per ounce and palladium was up by 1.2% at $2,340.66.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ gold ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Nakul Iyer in Bengaluru; Editing by Mark Potter and Emelia Sithole-Matarise)