London — Gold prices inched higher on Tuesday but were still hovering near their lowest in almost five months ahead of a widely expected US interest rate increase this week. Spot gold was up 0.1% at $1,242.86% by 11.30am GMT, after hitting its lowest since July 20 at $1,240.10 on Monday. US gold futures fell 0.1% to $1,246.30/oz. With an interest rate rise almost fully priced in, the market is keenly watching the US central bank’s two-day meeting for clues of the Federal Reserve’s future rate path. "The rise is already in the price so it’s more about the outlook the Fed gives," said ABN AMRO commodity strategist Georgette Boele. "Ahead of the Fed meeting, markets are relatively calm because they don’t want to get on the wrong foot." Gold is sensitive to rising US interest rates, as these increase the opportunity cost of holding non-yielding bullion and boost the dollar, in which it is priced. Analysts at Standard Chartered noted that gold would likely recover quickly from its recent...
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