Gold prices were trading close to their highest level in a week on
Thursday as weak U.S. inflation data weighed on the dollar and raised
hopes that the Federal Reserve would hold off hiking interest rates.
Comex gold futures for December delivery were dipped 0.15% to $1,117.30 an ounce, compared to overnight highs of $1,122.4.
Meanwhile, the dollar remained under pressure ahead of the conclusion of the closely watched Fed policy setting meeting later in the day amid uncertainty over whether the central bank would hike short term interest rates for the first time in almost a decade.
A rise in interest rates would boost the greenback by making it more attractive to yield-seeking investors, while putting gold under pressure, as it doesn’t yield interest.
EUR/USD was last at 1.1318, higher 0.23%, and GBP/USD also added 0.23% to trade at 1.5527.
We’ll get the Federal Open Market Committee statement with the rate-hike decision at 2 p.m. Eastern, with Yellen’s news conference half an hour after that.
Several economic reports come out before the Fed grabs the spotlight. Readings on weekly jobless claims and housing starts are slated to hit at 8:30 a.m. Eastern, followed by the Philly Fed survey at 10 a.m.
