Gold loses footing as focus turns to Fed minutes

Nov 20 – Gold prices edged lower on Monday, with a weaker dollar putting a floor under prices as investors awaited minutes of the Federal Reserve’s last meeting for cues on the central bank’s interest rate path.

Spot gold was down 0.1% at USD 1,977.49 per ounce by 3:33 p.m. ET (2033 GMT), after rising to as high as USD 1,993.29 on Friday. US gold futures settled 0.2% down at USD 1,980.30.

“Technically we’ve seen gold hit resistance and is back to range-bound trading with somewhat higher rates as a catalyst here,” said Bart Melek, head of commodity strategies at TD Securities.

The Fed was expected to maintain its narrative that monetary policy will depend on inflation and that it will keep rates elevated for as long as necessary, he added.

The minutes of the Fed meeting will be released on Tuesday.

Last week’s data reignited hopes that the Fed could begin easing monetary conditions sooner than expected after a slowing jobs market and a weaker-than-expected consumer inflation report.

Lower interest rates exert downward pressure on the dollar and bond yields, enhancing the appeal of non-yielding bullion.

Precious metals bulls have lost momentum and need fresh, fundamental impetus, analysts at Kitco Metals wrote in a note.

Rising US Treasury yields are trumping a lower US dollar and higher crude oil prices to keep gold and silver buyers skittish, Kitco said.

The dollar slipped 0.5% to a more than 2-1/2-month low against a basket of its rivals, limiting gold’s losses.

Holdings of SPDR Gold Trust GLD, the world’s largest gold-backed exchange-traded fund, rose 1.5% on Friday.

Elsewhere, spot silver rose 1.3% to USD 23.43 per ounce. Platinum jumped 2.2% to USD 918.95 and palladium gained 2.4% to USD 1,077.83 per ounce, both touching their highest in about two weeks.

(Reporting by Anjana Anil in Bengaluru; Editing by Emelia Sithole-Matarise and Shilpi Majumdar)