The price of gold was steady around its two-week high Tuesday morning as the U.S. dollar was mixed ahead of the 2-day FOMC meeting.
Gold for August delivery, the most actively traded contract, edged up $3.50 to $1,630.50 an ounce. Yesterday, gold ended almost flat on fading hopes of monetary stimulus after the Greek election outcome. Investors also reacted sharply to bond auctions in Span and Italy where yields soared to record levels, dragging gold prices marginally down for the first time in seven days.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, moved up to 1,281.62 tons from 1,277.39 tons.
This morning, the U.S. dollar was trading flat versus the euro, while ticking higher against sterling. The buck was edging lower versus the yen and the Swiss franc.
In economic news from the euro zone, U.K. annual inflation slowed unexpectedly in May to the lowest since November 2009, the Office for National Office said. Annual inflation eased to 2.8 percent, largely due to the slower increases in food and non-alcoholic beverage prices. Economists were expecting the rate to remain unchanged at 3 percent in May. Nonetheless, inflation continues to hover above the 2 percent target.
Meanwhile, survey results published by the Center For European Economic Research (ZEW) showed that German economic expectations declined more than expected in June. The ZEW Indicator of Economic Sentiment for Germany decreased by 27.7 points to a level of minus 16.9 points in June. This is the indicator's strongest decline since October 1998. Economists had forecast a decline to 2.3.
Elsewhere, the prices of silver and platinum were ticking higher in morning deals.
From the U.S., the Commerce Department will come out with its report on housing starts and building permits at 8:30 am ET. Economists estimate housing starts for May to come in at 720,000, while building permits are expected to have improved to 736,000.
by RTT Staff Writer
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