July 29, 2020 / 4:36 AM / 7 days ago

PRECIOUS-Gold pauses as investors await confirmation on Fed stance

    * Silver eases from multi-year peak
    * Gold up more than 28% so far this year
    * Interactive graphic tracking global spread of coronavirus:
open
tmsnrt.rs/3aIRuz7 in an external browser

 (Recasts, updates prices)
    By Brijesh Patel
    July 29 (Reuters) - Gold was little changed on Wednesday,
having retreated from an all-time high as investors booked
profits, with caution setting in as focus turned to a U.S.
Federal Reserve meeting widely expected to reinforce loose
monetary policy.
    Spot gold        was steady at $1,959.04 per ounce by 0723
GMT. Prices hit an all-time high of $1,980.57 on Tuesday. U.S.
gold futures         rose 0.1% to $1,958.20.
    "As we get closer to the Fed announcement and the event
risk, the market will get a bit more wary," said DailyFx
currency strategist Ilya Spivak.
    Gold is closely following moves in the dollar as well,
Spivak added.
    The dollar index resumed its downtrend after a brief pause
to hold near its lowest level since June 2018 touched this week
      . A weaker dollar, also considered a rival safe haven,
makes gold cheaper for holders of others currencies.       
    Coronavirus cases continued to surge in the United States
and stood at over 16.6 million globally.             
            
    Its intensifying spread and an escalation in U.S.-China
tensions have dented hopes of quick economic recovery, and have
been driving inflows to safe-haven assets like gold, which has
risen more than 28% so far this year.
    The Fed will publish its interest rate decision at 1800 GMT,
widely expected to keep rates unchanged, following which Chair
Jerome Powell is scheduled to hold a press conference.
    "I expect the Fed to maintain its uber-dovish tone and this
will support precious metals prices," said Jeffrey Halley, a
senior market analyst at OANDA.
    Gold tends to gain when interest rates are low, which
reduces the opportunity cost of holding non-yielding bullion.
It's also considered a hedge against inflation and currency
debasement as central bank pump out stimulus.
    Republicans in the White House and the U.S. Congress
struggled to reach a deal over a $1 trillion aid plan.
            
    Elsewhere, silver        dropped 1.1% to $24.31 per ounce,
platinum        fell 1.1% to $937.93 and palladium       
slipped 1.1% to $2,257.49.

 (Reporting by Brijesh Patel in Bengaluru; Editing by Vinay
Dwivedi and Uttaresh.V)
  
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