Investing.com - Gold prices edged lower on Wednesday, as market players awaited the release of key U.S. economic data while looking ahead to the outcome of the Federal Reserve's policy meeting.
On the Comex division of the New York Mercantile Exchange, gold futures for June delivery dipped $6.30, or 0.52%, to trade at $1,207.60 a troy ounce during European morning hours. Futures held in a tight range between $1,207.30 and $1,211.90.
On Tuesday, gold rallied to $1,214.60, the strongest level since April 7, before ending at $1,213.90, up $10.70, or 0.89%.
Futures were likely to find support at $1,174.10, the low from April 24, and resistance at $1,224.50, the high from April 6.
Also on the Comex, silver futures for July delivery shed 9.7 cents, or 0.58%, to trade at $16.53 a troy ounce. A day earlier, silver rose to $16.70, a level not seen since April 8, before settling at $16.63, up 19.1 cents, or 1.16%.
Investors were looking ahead to preliminary data on first quarter U.S. economic growth and a report on pending home sales later in the day for further indications on the strength of the recovery, ahead of the Federal Reserve's policy announcement.
A recent run of disappointing U.S. economic data dampened optimism over the recovery, fuelling speculation the Fed could delay hiking interest rates until late 2015, instead of tightening midyear.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.15% to trade at 96.03 early on Wednesday, the weakest level since March 18.
The dollar weakened broadly on Tuesday after data showing that U.S. consumer confidence deteriorated last month added to the expectations that the Fed will leave interest rates on hold at current record lows for longer.
The Conference Board reported that its consumer confidence index slumped to 95.2 in April, well below the forecast of 102.5 and down from 101.4 in March. Inflation rate expectations were the lowest since February 2007.
Elsewhere in metals trading, copper for July delivery inched down 1.2 cents, or 0.42%, to trade at $2.775 a pound. Copper hit $2.794 on Tuesday, the highest level since April 20, before ending at $2.786, up 0.9 cents, or 0.34%.
Copper remained supported amid speculation policymakers in China will have to introduce further stimulus measures to jumpstart the economy amid lackluster growth.
Since November, the People's Bank of China has introduced a series of stimulus measures, including lowering interest rates twice and cutting the reserve requirement ratios of major banks twice, in order to spur economic activity and boost growth.
The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption.
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