Gold edges higher, on track for third straight monthly gain
Gold prices edged up on Tuesday, en route to their third straight month of gains, as the dollar weakened, while market participants awaited the U.S. Federal Reserve policy decision later this week amid hopes of a less-aggressive rate hike.
Spot gold rose 0.2% to $1,925.39 per ounce as of 0257 GMT and was headed for a monthly gain of more than 5%.
U.S. gold futures were up 0.1% at $1,940.30.
The dollar index was down 0.1% and was set for a fourth straight monthly drop. A weaker greenback tends to make dollar-priced bullion an attractive bet.
Traders mostly expect the Fed to scale back rate hikes to 25 basis points (bps) at its two-day policy meeting that ends on Wednesday. The U.S. central bank slowed its tightening pace to 50 bps in December after four straight 75-bp hikes.
“The market is trading in a narrow range ahead of the Fed meet. The gold market has already priced in a 25 bps hike, if the Fed strikes a dovish tone, then it will be positive for gold,” said Ajay Kedia, director at Kedia Commodities, Mumbai.
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