\nSpot gold rose to a session high of $755.00, before slipping back to $734.60\/737.10 at 1424 GMT. Late in New York on Monday it was quoted at $729.60 an ounce.
\nCurrent moves in the gold market are pretty much U.S. -dollar driven, said Commerzbank senior trader Michael Kempinski, adding that gold’s fall during the market turmoil of recent weeks has tempered the metal’s safe haven appeal.
\n“We see good physical demand below or around $700 an ounce,” he said.
\nThe dollar slipped against the euro after earlier hitting a 2-1\/2 year high versus the single currency, as risk aversion eased.
\nTraders are eyeing the two-day rate-setting meeting of the U.S. Federal Open Market Committee, which is expected to deliver a decision on Wednesday.
\nThe Fed is expected to cut lending rates by half a percentage point to 1 percent, the lowest since June 2004, in a bid to calm turmoil in the financial markets.
\n“The U.S. dollar has broadly appreciated on the back of deleveraging in emerging markets and lower rate expectations elsewhere, with 50 basis points fully priced in for tomorrow’s Fed rate decision,” said analysts at Barclays Capital.
\n“There is some risk of a 75 basis point move as well, which could increase if the data are very weak,” they added.
\nWall Street stocks opened sharply higher, while European shares rose to break a five-day losing streak.The recovery in equities is supporting gold, as investors are under less pressure to sell the precious metal to cover losses on the stock markets.
\nOil prices also ticked higher, rising by more than $1 a barrel, tracking a rebound in stock markets. Firmer crude prices typically support gold, which is often bought as a hedge against oil-led inflation.
\nPlatinum, palladium jump:
\nPlatinum rebounded, climbing by 6 percent to its session high of $821.50, as the softer dollar boosted interest in the precious metal.
\nThe metal was pressured to five-year lows on Monday amid fears over falling demand from carmakers, who account for around half of annual platinum consumption.
\nMajor platinum producer Aquarius Platinum Ltd said in its first-quarter earnings report it has closed a shaft of its Marikana mine for care and maintenance against a backdrop of falling prices.
\n“This might help turn attention back onto supply-side issues,” said Tom Kendall, precious metals strategist at Mitsubishi Corp. “Though undoubtedly (there is) more bad news to come from auto sector too in the weeks ahead.”<\/p>\n","protected":false},"excerpt":{"rendered":"