Gold Edges Up as Dollar Slips Before FOMC Decision

Gold prices edged higher on Wednesday, supported by a weaker US dollar as market participants squared positions ahead of the Federal Reserve’s policy announcement.

The dollar index slipped, making dollar-denominated bullion more attractive for holders of other currencies. Traders have been adjusting portfolios in anticipation of the FOMC decision, due after the two-day meeting concluding on July 29.

Fed funds futures are pricing in roughly a one-in-three chance that the central bank will raise its benchmark interest rate at this meeting. While most analysts expect the Fed to hold steady, the pricing reflects lingering uncertainty.

Gold, which offers no yield, tends to benefit when the dollar weakens and rate-hike expectations are tempered. A hold decision could further support the metal, while a surprise hike would likely pressure prices.