June 14, 2017 / 5:02 AM / 2 months ago

PRECIOUS-Gold edges higher; fed meeting in focus

    * Fed statement due at 1800 GMT
    * Widely expected to raise U.S. interest rates
    * Platinum close to near one-month low hit on Tuesday

 (Adds quotes, updates prices)
    By Nithin ThomasPrasad and Vijaykumar Vedala
    BENGALURU, June 14 (Reuters) - Gold inched up on Wednesday
as the market waited for direction from the outcome of a two-day
U.S. Federal Reserve meeting, with the central bank expected to
hike interest rates and give indications on its monetary policy
for the rest of the year.   
    The Fed is scheduled to release its interest rate decision
at 2 p.m EDT (1800 GMT) on Wednesday, with Chair Janet Yellen
due to hold a press conference 30 minutes later.             
    Higher rates could boost the dollar, making commodities
priced in the greenback more expensive for holders of other
currencies. 
    "Most people have already priced in a rate hike in June,"
said Mark To, head of research at Hong Kong's Wing Fung
Financial Group.
    "What really matters is the anticipation on further action
and whether there will be hints on the extent or the schedule of
the shrinkage of the balance sheet as well as other monetary
policy actions." 
    The central bank could provide more details on its plans to
shrink the mammoth bond portfolio it amassed to nurse the
economic recovery.
    "Gold prices could see a temporary setback, especially with
the market currently far underestimating the pace of Fed rate
hikes," Commerzbank said in a note.  
    Spot gold        was up 0.1 percent at $1,267.05 per ounce
by 0806 GMT. On Tuesday, it touched its weakest since June 2 at
$1,259.16.
    U.S. gold futures         for August delivery were nearly
flat at $1,268.90 an ounce. 
    "With geopolitical risk having receded over the last week,
gold is now trading on fundamentals and will be ... subject to
the nuances of U.S. dollar weakness or strength," said Jeffrey
Halley, senior market analyst at OANDA.
    Meanwhile, the testimony of U.S. Attorney General Jeff
Sessions and his refusal to detail conversations with President
Donald Trump was deemed a "non-event" by some market analysts.
             
    Sessions' testimony did not provide any damaging new
information on Trump, but his refusal to discuss conversations
with Trump raised fresh questions about whether the White House
has something to hide.   
    In the wider markets, the U.S. dollar remained flat and
Asian shares turned mixed on Wednesday as investors everywhere
awaited clarity on the Fed's future path.                  
    Among other precious metals, silver        was flat at
$16.86 per ounce. On Tuesday, it hit its lowest since May 19 at
$16.68.
    Platinum        rose 0.2 percent to $925.25 per ounce but
was close to a near one-month low of $918.50 hit on Tuesday.
Meanwhile, palladium        fell 0.1 percent to $881.55 per
ounce.

 (Editing by Joseph Radford and Subhranshu Sahu)
  

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