Gold holds steady

Reuters
Bengaluru

Gold was mostly unchanged on Tuesday, after dropping over the past two sessions, as investors remained cautious ahead of a FederalReservemeetingthatstartslaterintheday. The U.S. central bank is widely expected to stand pat on policy but investors were bracing for any possible signals from the Fed about a tightening later this year. Gold is highly sensitive to rising rates, which lift the opportunity cost of holding nonyielding assets such as bullion, while boosting the dollar in which the precious metal is priced. Spot gold was at $1,315.51 an ounce at 0320 GMT, hovering above the previous session ´s close of $1,315.15. U.S. gold dipped 0.3 percent to $1,315.60 an ounce. "At this moment people are more conservative on the likelihood of an interest rate hike as well as further stimulus. That would induce further correction in gold prices," saidMark To, head of research at Hong Kong´sWing Fung Financial Group.