Gold prices rose on a background of a weakening dollar, but gains were limited due to the upcoming meeting of the Fed and the growth of US government bonds.
The US Central Bank will hold a meeting on Tuesday and Wednesday. It is expected to keep the intrest rate at the same level, but can give a clear signal about the possibility of a hike in December.
Rates unchanged may weaken the US currency, potentially making gold more attractive to buyers. “The dollar weakened slightly as a whole is good for precious metals and gold in particular … The economic data is not too good, so that they do not act now, – said Quantitative Commodity Research analyst Peter Fertig -. But there is a risk that Fed may surprise everyone and then precious metals will drop. “
Also, the gold market bulls are concerned about growth in real yields tied to the inflation rate of US bonds.
Nevertheless, the return of Chinese investors after the Mid-Autumn Festival, is expected to help to support gold, as well as strong technical support around the level of $ 1.305 per ounce, 100-day moving average.
The assets of the world’s largest gold exchange-traded fund (ETF) SPDR Gold Shares rose on Friday by more than 1 percent to 942.61 tons.
The cost of the October futures for gold on COMEX rose to $ 1317.5 per ounce.
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