Gold turns lower ahead of Fed meeting
London (Oct 29) Gold turned lower during Tuesday's trading session ahead of the two-day meeting of the Federal Reserve (Fed) starting today.
Gold futures were seen 0.53% lower at $1,345.10 an ounce during European trading on Tuesday, while silver futures dropped 0.75% to $22.370 an ounce at the time of writing.
Prices of gold futures reached $1,361.80 an ounce on Monday, which was the highest level since September 19.
Holdings in the SPDR Gold Trust, the world's biggest gold-backed exchange-traded fund, stood at 872.02 tonnes on Monday.
The US dollar index, measuring the relative strength of the greenback against a basket of six major currencies, was slightly higher 0.14% at 79.360 at the time of updating.
Fed's gathering
The Fed's policy-setting committee is due to meet this week and release its statement on Wednesday, with no expectations that any shift in the actual policy of buying $85 billion worth of bonds per month will be made as the real damage of the 17-day stalemate over debt deficit to the US economy is not yet clear.
"We believe the tapering will definitely be delayed and that's positive for precious metals," Brian Lan, managing director of GoldSilver Central, said, adding that "gold prices will close above $1,400 by the end of the year."
US data
Industrial production in the US picked up 0.6% in September on a monthly basis, compared to the rise of 0.4% reported in the previous month, a report by the Federal Reserve (Fed) revealed on Monday. The report was originally scheduled for October 17, but was delayed due to the government shutdown.
The US National Association of Realtors reported that pending home sales had plunged unexpectedly in September by 5.6%, compared with the fall of 1.6% seen in August. Analysts had expected a flat reading.
