Gold Crawls Higher Ahead Of Fed

PRECIOUS-Gold slips to two-week low ahead of Fed meet

"Fundamentals continue to support emerging markets including those in Asia, although the Fed's latest stance did add a layer of uncertainty going forward".

Gold prices reversed gains in aftermarket trading Wednesday, after the Federal Reserve kept alive hopes of a third rate increase this year and said it would begin shrinking its bond portfolio next month. No change in interest rates was expected from the Fed, but some hints as to the chances of another hike this year as well as an update of the terminal rate when the hiking process finishes, are expected.

Analysts said the market will also be looking for clues of whether the Fed will raise rates in December.

WALL STREET: Major U.S. benchmarks finished mostly higher. The Russell 2000 index of smaller-company stocks declined 0.1 percent, to 1,440.40.

The Bank of Japan is expected to reassure markets on Thursday that it will lag well behind its US counterpart in scaling back its massive stimulus, as an improving economy has yet to boost inflation anywhere near its elusive 2% target.

The dollar was steady versus the yen and against a basket a currencies early on Wednesday.

After some talk before the meeting that the Fed could hold off from raising rates again this year, the dollar jumped on the statement and extended those gains on Thursday to a two-month high of 112.725 yen. The Dow Jones industrial average gained 0.2 percent to 22,370.80.

"Anything he says that doesn't sound dovish, the market will take it as hawkish", said Paresh Upadhyaya, director of currency strategy at Amundi Pioneer Asset Management in Boston.

The U.S. 2-year Treasury yield hit a high of 1.430 percent, its highest level since July 6.

The Australian and New Zealand dollars pushed lower, with AUD/USD down 1.31% at 0.7926 and with NZD/USD dropping 0.71% to 0.7306.

South Korea's Kospi was off 0.16% at 2,412.20, while the Hang Seng Index in Hong Kong was up 0.27% at 28,127.80.

The dollar had weakened against the yen ahead of U.S. President Donald Trump's speech before the United Nations General Assembly.

"Even though gold still seems to be in a bullish trend, I think we'll probably test $1,300 first and then you'll see fresh speculative buying coming back in", a Hong-Kong based trader said.

In energy markets, oil prices retreated from near-five-month highs ahead of this week's meeting between key oil producers on the outlook for further supply cuts. Benchmark U.S. crude shed 51 cents to trade at $50.18 a barrel in electronic trading on the New York Mercantile Exchange, while Brent crude, used to price worldwide oils, dropped 43 cents to $56.86 a barrel in London.

US crude CLcv1 fell 43 cents to settle at $49.48 a barrel, while Brent LCOcv1 declined 34 cents to settle at $55.14.

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