by Ewa Manthey
Gold edged lower on Wednesday morning in London, with investors heading to the sidelines of the market ahead of the US Federal Open Market Committee (FOMC) policy meeting later today.
– The spot gold price was last at $1,232.30/1,232.60 per ounce, down 50 cents on the previous close. Trade has ranged narrowly from $1,229.80 to $1,235.40 so far.
– While the US central bank is not expected to make changes to the Federal Fund rate, investors will parse the tone and language of FOMC’s statement for any indications of the timings of future rate rises. Most market participants expect the next increase in July, according to the CME Group FedWatch.
– “The most likely outcome for gold we believe is for the wording in the policy statement to change sufficiently to weigh on any knee-jerk rally that accompanies the Fed forgoing raising rates. If the Fed raises rates then gold is likely to fall further, possibly finding support at $1,200. Either way, we believe the rally is being tested,” HSBC analyst James Steel said.
– In the other metals, silver was little changed at $15.28/15.30 per ounce. Platinum climbed $12 to $965/970 and palladium at $565/570 was up $2.
(Editing by Mark Shaw)
