SINGAPORE: Gold held steady in Asian trading on Monday as investors awaited indications from a key US Federal Reserve meeting later this week on the outlook for the central bank's bond buying programme.
The Fed meets on June 18-19 against a backdrop of stronger-than-expected data on US retail sales and the job market, with markets looking for clues to any tapering of its economic stimulus programme.
"The markets are a little bit fatigued at the moment," said Victor Thianpiriya, commodities analyst at Australia and New Zealand Banking Group. "They are still looking for direction from the Fed meeting. That's clearly the big driver this week."
Spot gold rose 0.02 percent to $1,390.41 an ounce by 0319 GMT. Bullion closed up about 0.5 percent for the week on Friday helped by strong demand for coins and bars, a pullback in US stocks and rising tensions in the Middle East.
US gold rose $2.40 to $1,390.
Markets have been volatile since Fed Chairman Ben Bernanke said last month the bank could scale back its stimulus measures if the economy improves. A cut in the Fed's $85 billion monthly bond purchases could hurt gold, which has benefitted from its role as a hedge against inflation.
Thianpiriya said Bernanke was unlikely to deviate from what he has said before, as it was still too early to determine the timing of the tapering down of the bond purchases.
Most economists expect the Fed to scale back the size of its bond purchases by year end, and several expect reduced buying as early as September, a Reuters poll showed.
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