Gold is range-bound as all eyes turn to the Fed

A strong dollar makes dollar-priced gold costlier for non-US investors, while rising US interest rates typically deter investors from buying a non-yielding asset such as gold.

The dollar index, which weighs the greenback against a basket of six major currencies, was flat at 94.143.

Gold dropped about 12% since hitting a peak in April, marred by rising US interest rates and a global trade war that has led investors to choose the dollar as a safe haven rather than gold.

“People are realising that the trade war is likely to continue. It is benefiting the US dollar now, but it could affect the US economy as well, hurting the dollar (and boosting gold),” Sharma said.

US President Donald Trump’s top trade official said on Tuesday that changing China’s economic policies to become more market-oriented “is not going to be easy” even with tariffs now in place on $250bn worth of Chinese goods.

Among other precious metals, spot palladium slipped 0.1% to $1,059.65/oz, drifting away from its late-January high of $1,068.50 hit in the previous session.

Silver gained 0.6% to $14.50, hovering near a more than three-week high of $14.56 reached on Tuesday.

Platinum edged 0.1% lower to $821.55/oz.

Reuters