NEW YORK: Gold firmed on Monday as investors squared positions ahead of key central bank meetings this week, with the Federal Reserve likely to signal the pace at which it may wind down pandemic-era economic support measures.

Spot gold was last up 0.3% at $1,786.95 per ounce as of 10:37 a.m. ET (1537 GMT). US gold futures gained 0.2% to $1,787.90.

“It’s a pretty quiet day for gold as the market awaits the FOMC’s meeting to see what central banks have to say about inflation and interest rates,” said Bob Haberkorn, senior market strategist at RJO Futures.

“The fact that no one is expecting a rate increase this week by any central bank is lending some support to gold” and unless the Fed announces immediate rate hikes next quarter, gold could be over $1,800 by year-end, Haberkorn added.

But preventing a breakout in gold from its recent $1,760-$1,795 range, risk appetite stabilised and the dollar firmed, making bullion more expensive for overseas buyers.

“In the short- to medium-term, gold’s not going anywhere until we get an idea of how much the Fed accelerates tapering and whether or not they are particularly hawkish in their statement,” said Michael Hewson, chief market analyst at CMC Markets UK.

Although gold is considered an inflation hedge, interest rate hikes raise the opportunity cost of holding non-yielding bullion.

Apart from the Fed, the European Central Bank, the Bank of England, and the Bank of Japan are scheduled to meet later this week.

Gold may be subdued in the first half of 2022 as the rate-hike cycle kicks off, Commerzbank said in a note, forecasting gold at $1,900 at end-2022, about $200 lower than its previous outlook.

A positive demand outlook would lift silver to $26 next year, Commerzbank added.

Spot silver was up 0.6% at $22.29 per ounce.

Platinum fell 1.1% to $932.14, and palladium was down 0.9% at $1,744.78.