Gold Prices Flat, Reflecting Caution Ahead of Fed Meeting By – Gold prices were little changed on Monday, losing steam after five consecutive sessions of gains as investors turned cautious despite expectations for hints at looser policy from the Federal Reserve on Wednesday.

for August delivery on the Comex division of the New York Mercantile Exchange, was nearly unchanged at $1,344.15 a troy ounce by 10:08 AM ET (14:08 GMT). Prices have risen 5% in the last three weeks alone on signs of the U.S. economy slowing, with the result that even the biggest ever monthly drop in the couldn’t drive prices higher on Monday.

Although the Fed is not expected to change interest rates on its policy decision on Wednesday, analysts are widely expecting U.S. central bank chief Jerome Powell to present a more dovish outlook.

“The one commodity with a clearer fundamental outlook now might be gold, which looks quite certain of taking on the $1,400 upside test this week amid expectations of a Fed rate cut,” senior commodity analyst Barani Krishnan said.

Markets have been steadily increasing bets that the Fed could cut interest rates as soon as July on signs of global economic weakness and subdued inflation in the U.S.

Gold generally benefits from lower interest rates that reduce the opportunity cost of holding the non-yielding bullion. Given that many sovereign bonds in Japan and the euro zone are now yielding below zero, gold has the unusual advantage of offering a premium over many other haven assets. That said, the yield on the has risen three basis points today from Friday’s all-time low of -0.27%

Geopolitical tensions have also supported the safe-haven metal with no signs of a potential de-escalation in trade tensions.

Over the weekend, U.S. Commerce Secretary Wilbur Ross appeared to dismiss the possibility of a deal being reached between U.S. President Donald Trump and Chinese counterpart Xi Jinping at the June 28-29 G20 summit. Ross emphasized that Trump was “perfectly happy” to stick with his current tariff strategy.

Tensions also showed no sign of cooling off in the Middle East. Coming just after U.S. Secretary of State Mike Pompeo accused Iran of being responsible for attacks on oil tankers last week, Tehran said it will break the internationally-agreed limit on its stocks of enriched uranium in 10 days unless Europe takes steps to help it mitigate the economic impact of U.S. sanctions.

Pompeo noted that the U.S. was studying a “full range of options” including military ones.

In other metals trading, rose 0.3% at $14.845 a troy ounce by 10:09 AM ET (14:09 GMT).

traded down 0.5% at $1,454.10 an ounce, while sister metal lost 1.4% to trade at $793.20 an ounce.

In base metals, gained 0.4% to $2.641 a pound.

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