Due to investors rearranging positions before the Federal Reserve’s meeting, gold futures sidled lower in European trade. The Fed’s two-day monetary policy meeting will begin later Tuesday.
With waning expectations that the Fed would decide to regulate rate hikes due to worries over an economic slowdown led by China, gold’s prices are up 16% so far this year.
Gold for June delivery on the Comex division of the New York Mercantile Exchange dropped 0.36 percent or $4.50, to trade at $1,235.80 a troy ounce by today. A day earlier, gold surged amid a weaker U.S. dollar. Meanwhile, the U.S. dollar index last stood at 94.72, barely changed for the day.
Gradual higher rates are seemingly less of a threat to gold prices than a rapid series of increases.
Comex also reported that silver futures for May delivery sank 8.4 cents, or 0.49 percent, to trade at $16.92. Copper futures, on the other hand, dipped 1.3 cents, or 0.58 percent to $2.243 a pound.
While the Fed is not expected to take action concerning rate hikes at the end of its meeting on Wednesday, traders will be anticipating its statements regarding the global economy and monetary policy outlook. Many in the market presume the steady pace of increases among global economic growth concerns and conflicting monetary policies between the U.S. and other countries.
Investors also examined data on March durable goods orders and a report on the April consumer confidence due later today to measure if the world’s largest economy is strong enough to survive further interest rates in 2016.