WASHINGTON (dpa-AFX) - Gold futures settled higher on Wednesday as the dollar shed ground against major counterparts ahead of the Federal Reserve's monetary policy announcement.
The dollar index dropped to 102.66, losing about 0.65% on expectations the Federal Reserve might pause its recent interest rate increases.
Gold futures for August ended higher by $10.30 at $1,968.90 an ounce.
Silver futures for July ended up $0.283 at $24.105 an ounce, while Copper futures for July settled at $3.8700 per pound, gaining $0.0390.
Data from the Labor Department on Tuesday showed the consumer price index inched up by 0.1% in May after climbing by 0.4% in April. Economists had expected prices to tick up by 0.2%.
Excluding food and energy prices, core consumer prices rose by 0.4% in May, matching the increase seen in each of the two previous months as well as economist estimates.
The Labor Department also said the annual rate of consumer price growth slowed to 4% in May from 4.9% in April. Economists had expected the pace of growth to slow to 4.1%.
The data added to optimism about the Fed pausing its recent interest rate increases today.
Investors will likely parse the accompanying policy statement, the summary of economic projections and remarks from Fed Chairman Jerome Powell during the press conference for clues over the appropriate path forward for monetary policy.
In economic releases today, the Labor Department said its producer price index for final demand fell by 0.3% in May after inching up by 0.2% in April. Economists had expected producer prices to edge down by 0.1%.
The report also showed the annual rate of producer price growth slowed to 1.1% in May from 2.3% in April. The rate of growth was expected to decelerate to 1.5%.
Meanwhile, the European Central Bank is expected to raise interest rates by 25 basis points on Thursday despite deepening fears of a recession in Europe.
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