Gold nudges up ahead of Fed rate decision

Gold prices ended in the green today, June 14, in the run-up to the Federal Reserve's monetary policy decision.

Also today, the US dollar index, which gauges the greenback's strength against a basket of six currencies, and Treasury yields tumbled. This came after the release of economic data showing a 0.3% month-on-month slump in US producer prices in May for the third time in four months.

Despite previous data reflecting a slowdown in consumer prices to their lowest level in more than two years at 4%, they are still far from the central bank's target of 2%.

In turn, financial markets are pricing in a 60% chance for a 25-basis-point increase in interest rates during the July meeting after policymakers wrap up their assessment of the economy and the overall financial system.

Traders are awaiting the Fed’s rate decision later in the day, amid expectations of a hold at the present 5-5.25% range, before turning attention to Fed Chairman Jerome Powell’s speech at the post-meeting news conference to explore monetary policy prospects for the coming period.

In terms of trading, bullion for August delivery advanced 0.55%, or $10.30, to $1,968.90 an ounce, after touching the $1,973.90 level in early trading.

Meanwhile, the US dollar index, which gauges the greenback's strength against a basket of six currencies, shed 0.55% to 102.75 points at 08:48 pm Makkah time, the lowest level since May 17.