The gold price stayed range-bound during Asian trading hours on Wednesday on a lack of stimulus ahead of the US Federal Open Market Committee meeting next week.
Spot gold was last at $1,124.5/1,124.8 per ounce on Wednesday, up $2.3 on Tuesday’s close. Trading ranged from $1,122.3-1,125.5 so far.
Gold is expected to continue trading in a tight range prior to the FOMC meeting on September 17, where members will contemplate whether to raise the Federal Funds rate for the first time since 2006.
There is no clear stimulus for gold amid the prevailing uncertainty about the US interest rate hike, said Commerzbank on Wednesday morning.
The yellow metal could also struggle to move higher in the near-term as a worse-than-expected Indian monsoon and a robust rupee have generated significant headwinds.
India is one of the world’s largest consumer of gold because rural farmers do not have access to standard lines of credit. Therefore, many store a majority of their wealth in physical properties like gold.
The spot gold price is also relatively flat amid weak trade data from China and strong global equity finishes.
August trade data from China on Tuesday showed that imports and exports had fallen by 14.3 percent and 6.1 percent respectively in yuan-denominated terms in the month.
In equities, major US bourses closed 2.4-2.7 percent higher boosted by a strong close on the Chinese stock market. The Shanghai composite index ended 2.92 percent higher at 3,170.452 after a late rally on Tuesday, the robust performance largely thought to be a result of intervention by Chinese regulators.
The Chinese index has continued its upward trajectory on Wednesday morning jumping 2.26 percent to 3,242.050 so far on Wednesday morning.
In other precious metals, silver was up $0.11 to $14.85/14.90 per ounce recently. Platinum was last at $1,005/1,010, up $7, while palladium rose $6 to $592/597 so far on Wednesday morning.
“Although platinum has gained some ground since its lowest level of around $943 beginning of August, the metal is still considered to be cheap,” said Commerzbank.
On the Shanghai Futures Exchange, gold for December delivery was unmoved at 233.2 yuan per gram, while December silver was flat at 3,383 yuan per kilogram recently on Wednesday morning.
(Additional reporting by Dalton Barker)
The post Gold stays in tight range ahead of FOMC meeting appeared first on The Bullion Desk.
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