Investing.com -- Gold inched up on Tuesday, closing higher for the third straight session, as investors remained cautious ahead of the Federal Reserve's latest interest rate decision following the completion of its two-day April meeting at the middle of this week.
On the Comex division of the New York Mercantile Exchange, gold for June delivery traded between $1,232.90 and $1,246.35 an ounce before settling at $1,242.25, up $2.05 or 0.17% on the day. With the recent rally, gold has nearly erased all of its losses from last Friday's sell-off when it plunged by more than 1.6%. During the last month of trading, gold is up by approximately $25 an ounce or approximately 2%. Additionally, the precious metal is up by roughly 17% since the start of the year and is on pace for one of its strongest opening halves in more than a decade.
Gold likely gained support at $1,063.20, the low from January 4 and was met with resistance at $1,280.70, the high from Mar. 11.
Investors continue to await Wednesday's monetary policy statement by the Federal Open Market Committee (FOMC), its third interest rate decision since their historic rate hike in December. The Fed has responded by holding its benchmark Federal Funds Rate at its current level between 0.25 and 0.50% in each of its first two meetings this year. Last month, the FOMC voted 9-1 to leave the Fed Funds Rate unchanged, with Kansas City Fed president Esther George serving as the lone dissenter.
On Tuesday, investors largely shrugged off a survey from CNBC, which showed that 48 top economists, strategists and fund managers expect the Fed to delay the timing of its next rate hike from June to August. In March, the FOMC downgraded its expectation for 2016 rate hikes from four to two, amid continual headwinds from global financial markets.
Any rate hikes by the Fed this year are viewed as bearish for gold, which struggles to compete with high-yield bearing assets in periods of rising rate environments.
Elsewhere, the latest projections from the Atlanta Fed's GDPNow forecast model showed that the U.S. economy is growing at a rate of 0.4% over the first quarter. The projections were recalibrated following the release of home data and durable goods order. The upward revision represents a 0.1% gain from the Atlanta Fed's previous estimate on April 19.
In March, new durable goods orders in the U.S. increased by 0.8% on a monthly basis, sharply below consensus estimates of a 1.6% gain. A considerable increase in defense goods helped offset losses among commercial aircrafts, which continued to weigh. The modest gains in durable goods orders last month, came one month after new orders tumbled by a downwardly revised 3.1% decline in February.
The U.S. Dollar Index, which measures the strength of the greenback versus a basket of six other major currencies, lost more than 0.35% to an intraday low of 94.40. The index remains near eight-month lows.
Silver for May delivery gained 0.091 or 0.54% to $17.100 an ounce.
Copper for May delivery fell 0.008 or 0.35% to $2.248 a pound.