Comex gold futures finished lower on Wednesday in ongoing choppy trade ahead of Thursday's US Federal Open Market Committee decision about how much higher to raise interest rates and before a US holiday.
Gold for August delivery at the Comex division of the New York Mercantile Exchange fell $3.40 to conclude at $581 an ounce, after trading between $589.40 and $579.10. Players were reluctant to fortify positions in gold before the Fed meeting and any resulting word on future rate plans, dealers said.
Additionally, traders have started squaring their books before New York futures shut on Friday and remain closed on Monday and Tuesday for the US Independence Day holiday. "Gold looks set to remain in a pretty lacklustre mood for the next 24 hours," said James Moore, an analyst with TheBullionDesk, in a note.
"The outcome of the FOMC meeting and some month/quarter end window dressing could shake things up before the end of the week. However, the current $550 to $600 (trading range) appears pretty solid for the moment."
The Fed.'s decision was expected to be announced on Thursday at around 2:15 pm at the end of its two-day talks. The interbank overnight fed funds rate was widely expected to be raised to 5.25 percent from 5.00 percent, which would mark the 17th straight hike in the benchmark-lending rate.
"We are waiting for the Fed to increase (rates). The market may be treading water until tomorrow afternoon," said George Gero, vice president at RBC Capital Markets Global Futures. Final estimated Comex gold volume was moderate at 42,000 contracts, off from Tuesday's official tally of 53,619 lots.
The dollar strengthened as investors grew more confident that rates may rise further after a likely hike on Thursday. The euro slipped 0.4 percent to $1.2530. A stronger dollar tends to dampen gold buying by investors holding foreign money. Spot gold pulled back to $579.60/580.30, versus on Tuesday's New York close at $581.50/2.50.
Comex next active September silver was off 5.7 cents at $10.2420 an ounce. Nearby July fell 4.0 cents to $10.1550. Spot silver backed off to $10.18/28, against $10.23/33 late on Tuesday. Nymex October platinum dropped $10.80 to finish at $1,200 an ounce.
July slid $10.10 to end at $1,178.20. Spot was off at $1,184/90. September palladium lost $1.40 to $312.80 an ounce. Spot last was worth $307/312.