Gold slips from two-week high on firmer dollar; Fed minutes in focus

Kitco Media
By Reuters
Published:
Updated:
Reuters
Gold slips from two-week high on firmer dollar; Fed minutes in focus teaser image

July 6 (Reuters) - Gold nudged lower after hitting a two-week ‌high earlier on Monday, as the U.S. dollar ticked up in anticipation of the Federal Reserve's last policy meeting minutes due later this week.

Spot gold was down 0.46% at $4,156.36 per ​ounce, as of 1123 GMT, after hitting $4,202.13, its highest since June 22 ​earlier in the session.

U.S. gold futures for August delivery rose 1.1% ⁠to $4,168.90 per ounce.

The U.S. dollar gained 0.2%, making greenback-priced bullion more expensive ​for holders of other currencies.

Saxo Bank analyst Ole Hansen said that gold is in a ​consolidation phase and a further easing in rate hike expectations is needed to support prices.

"Gold is trying to build a base with support in the $3,900-$4,000 range, while numerous levels of ​resistance await ahead of the big one, which remains the 200-day moving average ​at $4,485," he added.

The yellow metal rose more than 2% last week, ending a four-week losing ‌streak ⁠after weak U.S. job growth data reduced bets for rate hikes.

Traders still see about a 56% chance of a rate increase in September, down from more than 60% before the data, according to the CME FedWatch tool. FEDWATCH/

Higher interest rates tend to ​pressure the non-yielding ​metal.

The Fed's June ⁠16-17 meeting minutes, the first chaired by Kevin Warsh, due on Wednesday, could give traders further insights into policymakers' rate ​outlook.

J.P. Morgan, in a note on Friday, said that demand ​for gold ⁠from key sectors would not be as strong as expected, with prices limited to $4,300/oz in the third quarter and $4,500 in the fourth quarter of this year.

Among other ⁠metals, spot ​silver fell 0.5% to $62.12 per ounce after hitting ​its highest since June 23 earlier.

Platinum 0.3% to $1,643.44 per ounce and palladium inched 0.7% higher to $1,282.97 ​per ounce.

Reporting by Sumit Saha in Bengaluru; Editing by Harikrishnan Nair and Louise Heavens

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