Investing.com - Gold prices ticked higher on Monday as the dollar slid lower, but gains were held in check ahead of the Federal Reserve’s policy meeting later in the week.
Gold futures for June delivery were at $1,232.8 an ounce at 0941 GMT, up 0.23% from their last settlement.
The dollar rose to three-week highs against the yen overnight, but later reversed gains ahead of meeting of the U.S. and Japanese central banks later this week.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.18% at 94.94.
The Fed, which hiked rates for the first time in almost a decade in December, is expected to hold steady at the conclusion of its two-day policy meeting on Wednesday.
Investors will be looking at the bank’s rate statement for indications on the likelihood of a June interest rate increase after Fed Chair Janet Yellen said recently that the central bank should take a cautious approach towards future rate hikes.
Lower interest rates tend to help gold, as the metal pays its holders nothing, but it struggles to compete with yield-bearing investments when interest rates rise.
Gold prices posted their strongest quarterly gains in 30 years in the first quarter of 2016 as global growth concerns and investor uneasiness about negative-interest-rate policies in Japan and Europe bolstered investor appetite for bullion.
Gold’s gains have slowed since then but the precious metal is still up almost 17% for the year to date.
Elsewhere in precious metals trading, silver for May delivery was at $16.90 an ounce and copper for July delivery was down 0.55% to $2.256 a pound.