Gold slipped to its lowest level in over two weeks on Monday as the dollar and equities rallied, while prospects of monetary policy tightening in the United States ahead of a Federal Reserve meeting also weighed on the metal. Spot gold was down 0.3 percent at $1,315.36 an ounce by 0658 GMT. Earlier in the session, gold hit $1314.36, its lowest since Aug 31.
US gold futures for December delivery fell 0.5 percent to $1,319 an ounce. "Further risk-taking appetite left gold prices in the dust," said OCBC analyst Barnabas Gan. The two-day Fed Open Market Committee meeting, which begins on Tuesday, will be closely watched by markets as the US central bank is expected to announce its balance sheet reduction plans while keeping interest rates unchanged in an effort to "normalise" monetary policy.
"Gold prices also came under some selling pressure, with investors dismissing geopolitical risks and instead focusing on the possibility of rate hikes from central banks," ANZ analyst Daniel Hynes said in a note. Spot gold may drop to $1,309 per ounce, as it has broken a support at $1,321, said Reuters technical analyst Wang Tao.
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