Gold Stays Down With Eyes On U.S. Fed

Singapore (Mar 18)   Gold futures are trading lower in the Asia electronic session today with the focus now turning on two-day Federal Open Market Committee’s meeting on Tuesday and Wednesday.

Gold for April delivery is down $11.90 to $1,361 an ounce on the Comex division of the New York Mercantile Exchange. Yesterday, it fell $6.10, or 0.4%, to settle at $1,372.90 an ounce losing most of Friday's 0.5% gain.

Last week, gold prices gained on 3% amid the geopolitical uncertainty heading into the Crimea referendum. The White House announced limited sanctions on seven Russian officials, two Crimea-based separatist leaders and former Ukraine President Viktor Yanukovych and his presidential chief of staff in response to the referendum.

Traders now await the Federal Reserve's policy meeting on Tuesday and Wednesday. The U.S. central bank is expected to announce another $10 billion cut to its bond-buying stimulus.

On the domestic front today, the Goldman Sachs upgraded Indian shares to "overweight" from "marketweight" and raised its target on India's NSE index to 7,600, citing reduced external vulnerabilities, including a narrowing current account deficit, and potential for gains ahead of elections that conclude in May.

The Indian rupee gained 28 paise to 60.91 against the US dollar. Weakness of dollar in the overseas market also boosted the Indian rupee value.

The domestic metal is under additional pressure today due to appreciation in the Indian Rupee. MCX April bullion is trading down nearly Rs 200 at Rs 30182 per 10 grams. The metal may find support near Rs 30100-50 levels.

Source: IndiaInfoline