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Main focus will be on Fed Chair Powell's speech - analyst
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Spot gold may fall into $1,883-$1,905 range - technicals
(Updates prices)
By Ashitha Shivaprasad
Jan 30 (Reuters) - Gold prices traded in a relatively
tight range on Monday, while market participants globally
awaited a slew of central bank meetings with the main focus on
the U.S. Federal Reserve.
Spot gold edged 0.2% higher to $1,931.07 per
ounce, as of 0717 GMT. U.S. gold futures were up 0.1% at
$1,930.50.
At the end of the Fed's Jan. 31-Feb. 1 meeting, traders are
broadly expecting the U.S. central bank to scale back its rate
hikes to 25 basis points (bps) from 50 bps in December. "Gold prices are currently consolidating into a range ahead
of the Fed meet. The main focus will be on the tone that Fed
Chair Jerome Powell will strike in his speech," said Ilya
Spivak, head of global macro at Tastylive.
Gold, being a non-yielding asset, tends to benefit when
interest rates are low as it reduces the opportunity cost of
holding bullion.
Data on Friday showed that U.S. consumer spending fell in
December, while inflation continued to subside, which could give
the Fed room to further slow the pace of its rate hikes.
The European Central Bank (ECB) and the Bank of England
(BoE) are also having policy meetings this week.
Spot gold may break a support at $1,919 and fall into a range of $1,883 to $1,905 per ounce, according to Reuters technical analyst Wang Tao.
The current wave of COVID-19 infections in top bullion consumer China is nearing an end, and there was no significant rebound in cases during the Lunar New Year holidays, the Chinese Center for Disease Control and Prevention said in its latest weekly update.
As the Chinese economy continues to open up, there will be greater industry and luxury demand for gold, said Clifford Bennett, chief economist at ACY Securities. Spot silver gained 0.8% to $23.74 per ounce, platinum rose 0.1% to $1,013.40, and palladium climbed 1.3% to $1,639.90. (Reporting by Ashitha Shivaprasad in Bengaluru; Editing by Uttaresh.V, Sherry Jacob-Phillips and Subhranshu Sahu)
