Gold Price Heads for Third Straight Drop With Focus on Key Fed Meeting
New York (Jun 15) Gold headed for its third straight decline as investors awaited hints from Federal Reserve policy makers meeting this week on when they’re likely to start withdrawing economic stimulus.
The dollar rose and the yield on 10-year Treasuries edged higher, damping the appeal of the non-interest-bearing precious metal. Bullion traders’ attention will be on the two-day meeting that concludes Wednesday, as well as comments from central bank Chair Jerome Powell later that day.
Bullion has retreated after reaching the highest since January earlier this month, with investors weighing inflation pressures and possible responses by central banks. Fed officials could project interest-rate liftoff in 2023 amid faster growth and inflation, but they won’t signal scaling back bond purchases until August or September, according to economists surveyed by Bloomberg.
“Gold may remain under pressure ahead of the FOMC meeting, weighed down by strength in the U.S. dollar,” said Yeap Jun Rong, a strategist at IG Asia Pte. “Any signs of an earlier timeline for tapering in the upcoming meeting may translate to downward pressure for gold.”
Spot gold fell 0.5% to $1,856.61 an ounce at 12:08 p.m. in New York. A third straight decline would be the longest slump since March 1. Silver and platinum also dropped, while palladium inched up. The Bloomberg Dollar Spot Index rose 0.1%.
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