The Price Of Gold Falls For The Week As Investors Await The Fed's Meeting

Gold prices experienced a decline on Friday, threatening to erase the gains made earlier in the week. Despite signs of easing inflation in the U.S. and Europe, which have contributed to a rise in precious metals prices this month, the market remains uncertain about the potential for central banks to moderate interest rate increases.

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In specific price movements:

• Gold for August delivery traded at $1,962.10 per ounce on Comex, marking a decrease of $8.80 or 0.4% from the previous day's finish of $1,964.40.
• Silver for September delivery fell 13.2 cents, or 0.5%, to $24.83 per ounce.
• October platinum rose by $1 or 0.1% to reach $965.10 per ounce, while September palladium increased by $5.70 or 0.5%, reaching $1,281 per ounce.
• September copper declined by 2 cents, or 0.5%, to $3.815 per pound.

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The month has seen higher gold prices, with support building since the release of U.S. June inflation data earlier this month, revealing a slower pace of consumer price increases compared to August 2021. This indication of waning inflation has exceeded the expectations of Wall Street economists and even the Federal Reserve.

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Data shows that prices based on the most-active contract have risen approximately 1.6% during the month.

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Looking ahead, investors are eager to learn how this data will influence the Federal Reserve's plans for interest rate hikes, with Chair Jerome Powell scheduled to deliver his post-meeting press conference on Wednesday. The market has been optimistic in July, with hopes that the upcoming rate hike will be the last in this cycle, leading to a potential reclamation of the $2,000 handle on gold for bullish investors.

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However, should the Federal Reserve signal a continuation of rate hikes beyond this month, it may prompt a pullback in gold prices, causing a decline back into the lower-$1,900 range.

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Adding to the pressure on gold prices, the U.S. dollar was trading higher on Friday, standing at 101.17 and registering a 0.3% increase for the day.

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