AIRLINK 74.85 Increased By ▲ 0.56 (0.75%)
BOP 4.98 Increased By ▲ 0.03 (0.61%)
CNERGY 4.49 Increased By ▲ 0.12 (2.75%)
DFML 40.00 Increased By ▲ 1.20 (3.09%)
DGKC 86.35 Increased By ▲ 1.53 (1.8%)
FCCL 21.36 Increased By ▲ 0.15 (0.71%)
FFBL 33.85 Decreased By ▼ -0.27 (-0.79%)
FFL 9.72 Increased By ▲ 0.02 (0.21%)
GGL 10.45 Increased By ▲ 0.03 (0.29%)
HBL 112.74 Decreased By ▼ -0.26 (-0.23%)
HUBC 137.44 Increased By ▲ 1.24 (0.91%)
HUMNL 11.42 Decreased By ▼ -0.48 (-4.03%)
KEL 5.28 Increased By ▲ 0.57 (12.1%)
KOSM 4.63 Increased By ▲ 0.19 (4.28%)
MLCF 37.80 Increased By ▲ 0.15 (0.4%)
OGDC 139.50 Increased By ▲ 3.30 (2.42%)
PAEL 25.61 Increased By ▲ 0.51 (2.03%)
PIAA 20.68 Increased By ▲ 1.44 (7.48%)
PIBTL 6.80 Increased By ▲ 0.09 (1.34%)
PPL 122.20 Increased By ▲ 0.10 (0.08%)
PRL 26.58 Decreased By ▼ -0.07 (-0.26%)
PTC 14.05 Increased By ▲ 0.12 (0.86%)
SEARL 58.98 Increased By ▲ 1.76 (3.08%)
SNGP 68.95 Increased By ▲ 1.35 (2%)
SSGC 10.30 Increased By ▲ 0.05 (0.49%)
TELE 8.38 Decreased By ▼ -0.02 (-0.24%)
TPLP 11.06 Decreased By ▼ -0.07 (-0.63%)
TRG 64.19 Increased By ▲ 1.38 (2.2%)
UNITY 26.55 Increased By ▲ 0.05 (0.19%)
WTL 1.45 Increased By ▲ 0.10 (7.41%)
BR100 7,841 Increased By 30.9 (0.4%)
BR30 25,465 Increased By 315.4 (1.25%)
KSE100 75,114 Increased By 157.8 (0.21%)
KSE30 24,114 Increased By 30.8 (0.13%)

imageNEW YORK/LONDON: Gold fell more than 1 percent on Tuesday as US equities rallied and bullion buyers took to the sidelines before the conclusion of a two-day Federal Reserve policy meeting they hope will give greater clarity on the outlook for US monetary policy.

The metal fell for a second consecutive day - the first time in nearly a month - as its safe-haven appeal was reduced by the rise of US equities on hopes that the Fed will maintain its current level of stimulus at the end of its Federal Open Market Committee meeting on Wednesday.

Traders are trying to anticipate the Fed's timetable for winding down purchases of $85 billion per month of bonds, a program known as quantitative easing.

Gold, a traditional inflation hedge, has been under pressure after top Fed policymakers said last month the central bank could scale back its stimulus measures.

The precious metal could, however, stage a short-covering rally after the conclusion of the meeting, analysts said.

"Should the FOMC not come any closer to giving greater clarification on the asset-buying program, then the gold market could rally and investors who have been shorting gold in anticipation of a Fed move away from QE may have to cover," said James Steel, chief precious metals analyst at HSBC.

"This could prompt a challenge of the $1,400 an ounce level," Steel said.

Spot gold was down 1.3 percent at $1,366.60 an ounce at 3:15 p.m. EDT (1915 GMT), having earlier hit a near one-month low of $1,360.54.

US Comex gold futures for August delivery settled down $16.20 an ounce at $1,366.90, with trading volume at around half of its 30-day daily average, preliminary Reuters data showed.

On Tuesday, US inflation showed signs of stabilizing in May after a long decline, government data showed, a potential comfort to Federal Reserve policymakers who want to avoid any chance of a debilitating bout of deflation. The S&P 500 index gained nearly 1 pct.

Concerns that US monetary policy may be reined in have helped knock gold prices 18 percent lower this year.

Silver fell 0.8 percent to $21.65 an ounce.

The CME Group's smaller silver contract, the physically delivered 1,000-ounce silver futures, logged total volume of 30 lots on its second day of trading on Tuesday, according to CME's website. (Link: http://link.reuters.com/myt88t)

Turnover of the benchmark 5,000-ounce Comex silver futures was around 58,000 lots, below its 30-day average at 55,000, preliminary Reuters data showed.

INDIAN, CHINESE BUYERS HOLD OFF

Physical demand retreated in India and China, the top two consumers of bullion, from peak levels reached after a steep

sell-off in April.

A Hong Kong precious metals trader said premiums there had fallen to $2 an ounce over London spot prices, from a high of $6 last month. Hong Kong sells mainly to buyers in China.

Any signs of a significant slowdown in the Chinese market would be a big blow to bullion prices because investors expect China to offset slower buying from India.

Demand in India has eased since the government increased the import duty on bullion by a third in an effort to reduce its current account deficit.

Among other precious metals, platinum gained 0.7 percent to $1,439.99 an ounce and palladium fell 0.7 percent to $707.43 an ounce.

Comments

Comments are closed.