Gold futures ticked marginally higher early Monday, finding their footing as the U.S. dollar held steady and investors looked ahead to this week’s Federal Reserve meeting.
Gold for December delivery
GC00,
GCZ21,
was up 50 cents, or less than 0.1%, at $1,784.40 an ounce on Comex. The precious metal, based on the most-active contract, ended Friday with a weekly decline of 0.7%, according to Dow Jones Market Data, but rose 1.5% in October — the strongest monthly advance since July.
Gold was pressured last week as the dollar rallied. A stronger dollar can be a negative for gold and other commodities priced in the unit, making them more expensive to users of other currencies.
The Federal Reserve, in a two-day meeting set to conclude Wednesday, is expected to announce plans to begin tapering its monthly bond buys.
See: Fed seen announcing start of a ‘taper’ of bond purchases next week
“Inflation continues to worry central bank officials, with lingering supply chain issues and high energy prices making a protracted rise in consumer prices more likely than previously thought,” said Ricardo Evangelista, senior analyst at ActivTrades, in a note.
Read: What Federal Reserve tapering means for markets
Expected tapering by the Fed would make for a scenario “that is likely to offer support to the dollar and penalize the precious metal, due to the inverted correlation between the two assets,” he said.
December silver
SIZ21,
was down 5.9 cents, or 0.2%, to $23.89 an ounce. The metal on Friday notched the first monthly advance in five months, up 8.6% in October. For the week, silver ended down by about 2.1%.
This post was originally published on Market Watch
