Krasnoyarsk, May. 2 (Us): Gold prices stabilized on Tuesday, as cautious market participants await fresh signals from major central banks on their monetary policy plans, especially from the US Federal Reserve.
Spot gold was unchanged at $1,983.29 an ounce by 0528 GMT. US gold futures fell 0.1% to $1,991.00, Reuters reported.
The Fed, which meets May 2-3, is widely expected to raise interest rates by 25 basis points.
Gold prices could move towards $2,000 if the Fed highlights recession fears and hints at a pause in the rate hike cycle, said Ajay Kedia, director of Kedia Commodities in Mumbai.
Manufacturing in the United States contracted in April but there was a build-up of inflation pressures, supporting expectations of a Fed rate hike, according to data released on Monday.
The European Central Bank is also likely to raise interest rates for the seventh consecutive meeting on Thursday.
Bullion is known as a hedge against inflation and economic uncertainties, but rising prices tend to reduce demand for zero-yielding assets.
In the previous session, gold prices rose briefly above $2,000 after JP Morgan’s acquisition of First Republic Bank’s assets.
Regulators seized First Republic Bank and sold its assets to JPMorgan Chase & Co on Monday, in a deal to resolve the biggest US bank failure since the 2008 financial crisis and put an end to the ongoing banking turmoil.
Spot silver prices fell 0.4 percent to $24.87 an ounce.
“We are optimistic about silver as industrial demand for it will increase in 2023. Prices could reach $32 this year,” Kedia added.
Platinum lost 0.1%, to $1,048.34, while palladium rose 1%, to $1,466.36.
Rial