Gold prices edge up ahead of Fed meeting

Gold prices rose in European trade on Monday, resuming gains after a hiatus, as the dollar currently loses ground against a basket of major rivals.

Gold's gains remain rather limited as investors shun heavy positions ahead of the Federal Reserve's policy meeting this week.

Gold Prices Today

Gold prices rose 0.2% to $1,965.11 an ounce, with a session-low at $1,954, after losing 0.25% on Friday, away from a week high at $1,973.

Gold prices rose 0.7% last week, the first weekly profit in five weeks as odds for a 0.25% Fed rate hike this month collapsed.

The Dollar

The dollar index fell 0.2% on Monday, resuming losses and almost hitting two-week lows against a basket of major rivals.

A weaker dollar makes dollar-denominated gold futures costlier to holders of other currencies. 

US Rates

Markets are currently pricing in a 26% chance of a 0.25% Fed rate hike in June. 

US Inflation

Markets await crucial US inflation data tomorrow to better gauge the likely path ahead for monetary policy.

The Fed

The Federal Reserve is starting its two-day policy meeting tomorrow, with most economists expecting the Federal Reserve to steer off a rate hike this month. 

The SPDR

Gold holdings at the SPDR Gold Trust fell 2.89 tones on Friday to a total of 931.76 tones, the lowest since May 4.