Gold slides as dollar rises ahead of Fed rates decision
Gold has gained more than 5% in January — its best month since June 2016 — as the dollar suffered its worst start to the year in three decades
Gold is highly exposed to interest rates, particularly in the US, as higher rates lift the opportunity cost of holding non-yielding assets and boost the dollar, in which gold is priced. The Fed was expected to keep US interest rates unchanged on Wednesday in its first policy decision since President Donald Trump took office, as the central bank awaits greater clarity on his economic policies. "It’s a little too early for the Fed to press ahead with the rate hike at the moment but it will be interesting to see the comments they make with regards to Trump’s presidency and the expectations for inflation," said Capital Economics commodities economist, Simona Gambarini. Capital Economics expects rate hikes in the second half of the year, Gambarini said, which could hurt gold. Spot gold was down 0.8% at $1,200.77/oz by 15.35 GMT, after touching a session low of $1,213.20/oz. US gold futures fell 0.7% to $1,202.70 an ounce. Gold gained more than 5% in January — its best month since June 20...
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