Gold off 2-week high as dollar firms ahead of Fed decision

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Gold prices eased on Wednesday, retreating from a near two-week high hit in the previous session, as the dollar gained ahead of a U.S. Federal Reserve policy decision due later in the day.

FUNDAMENTALS

Spot gold was down 0.2% to $1,952.15 per ounce by 0026 GMT, after hitting its highest since Sept. 2 at $1,971.71 on Tuesday.

U.S. gold futures fell 0.3% to $1,960.50.

The dollar index rose against its rivals, making gold more expensive for holders of other currencies.

Asian shares were set for a mixed open, although upbeat Chinese and U.S. economic data is likely to give sentiment a tailwind.

Later in the day the Fed will conclude its first meeting since adopting a more accommodative approach to inflation and pledging to keep interest rates low for longer.

The Fed decision is due at 1800 GMT, followed by a news conference from Chairman Jerome Powell half an hour later.

Gold is seen as a hedge against inflation. Lower interest rates decrease the opportunity cost of holding non-yielding bullion.

U.S. House of Representatives Speaker Nancy Pelosi said Democrats were open to delaying an October recess to get a deal with Republicans on a new coronavirus aid bill.

More than 29.39 million people have been reported to be infected by the novel coronavirus globally and 928,669? have died, according to a Reuters tally.

Japan’s exports slumped 14.8% in August from a year earlier, down for the 21st straight month, data showed, underlining the COVID-19 pandemic’s heavy hit to global demand.

Silver dipped 0.3% to $27.09 per ounce, platinum dropped 1.5% to $963.38 and palladium slipped 0.9% to $2,388.29.

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