Gold down 1.8% for the week. Gold range-bound as all eyes on next FOMC meet – analyst. Palladium down more than 8% for the week (Adds comment, updates prices)
Gold steadied on Friday, buoyed by a slight dip in the dollar, but uncertainty over the U.S. Federal Reserve’s next moves on unwinding its economic support measures kept some investors on the sidelines.
Spot gold was little changed at $1,794.46 per ounce by 1255 GMT, while U.S. gold futures fell 0.2% to $1,796.60.
Lending support to gold, the dollar index was subdued on the day, making bullion more appealing for those holding other currencies.
But the U.S. currency was still set for a first weekly gain in three, which also put gold on track for a weekly decline of 1.8%.
Gold is rather hovering around the $1,800 mark, and many market participants are waiting on the sidelines in part due to the uncertainty surrounding the Fed’s tapering timeline, said Commerzbank analyst Daniel Briesemann.
“The decision of the Fed, when they begin tapering, is hanging over gold.”
The Federal Open Market Committee is scheduled to next meet on September 21-22.
Gold investors closely follow cues from the Fed, since non-yielding bullion tends to gain when interest rates are low, while some consider bullion a hedge against higher inflation fuelled by massive stimulus.
And the signals were mixed, with a recent Fed report showing the U.S. economy “downshifted slightly” in August. But a number of Fed officials said this week the August slowdown in job growth would not throw off plans to reduce asset purchases this year.
Gold continued to see range-bound trade and since the metal is “primarily looked at in terms of the dollar… it’s the Fed which has the big impact on the gold price,” said UBS analyst Giovanni Staunovo.
Elsewhere, silver fell 0.2% to $24.03 per ounce, while platinum rose 0.1% to $977.63. Palladium climbed 0.7% to $2,194.78 but was down over 8% for the week.
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