RTRS:PRECIOUS-Gold ticks lower on equities, Fed in focus
* Cash gold to drop to $1,703 -technicals
* Coming up: Fed starts two-day policy meeting
(Updates prices)
By Lewa Pardomuan
SINGAPORE, Oct 23 (Reuters) - Gold edged lower after
equities gave up early gains on Tuesday, although demand from
jewellers helped prices rebound from their lowest in more than a
month as investors waited on the results of a U.S. Federal
Reserve meeting.
Even though the Fed is likely to hold off from new moves at
its two-day gathering after taking significant action last
month, its policy statement on Wednesday will be closely
scrutinised.
Gold eased $5.40 to $1,722.89 an ounce by 0605 GMT
after falling to a six-week low around $1,713 on Monday - a
level which ignited demand from jewellers and speculators in
Asia.
"We are not expecting much, unless there are surprises from
the Fed. So I believe gold will still be trading within this
band. A lot of investors are also eyeing the outcome of the
presidential election in the U.S.," said Brian Lan, managing
director of GoldSilver Central Pte Ltd in Singapore.
"On the local market front, there's still very positive
demand from clients. We see more clients coming to purchase
gold, especially whenever there's a price dip."
U.S. gold for December was at $1,723.90 an ounce,
down $2.40.
The U.S. central bank's policy-setting Federal Open Market
Committee starts its meeting on Tuesday and is scheduled to
release a statement on its policy deliberations at around 2:15
p.m. (1815 GMT) on Wednesday.
"Markets could also be positioning ahead of the FOMC meeting
as the Fed has previously talked up its capacity to support the
U.S. economy, but we are not expecting any signs of fresh
stimulus," ANZ said in a report.
In other markets, Asian shares were lacklustre with the
corporate reporting season getting underway in the region, as
investors stayed cautious after global shares faltered overnight
on weak earning reports and outlook.
The euro held steady against the dollar as
expectations that Spain will apply for a bailout helped support
the euro in recent weeks, but uncertainty over the timing of
such a move has limited its gains.
The physical gold market was subdued after seeing strong
demand from top consumer India following a drop in prices on
Monday. Premiums were steady in Singapore at 80 cents.
"Perhaps India will buy again if prices don't move
extensively higher. There's one thing to note though - Indonesia
and Thai currencies are strong, so gold has become less
appealing as an investment," said a dealer in Singapore.
In India, demand jumped overnight after a rebound in the
rupee cut prices 1 percent during the country's festival season,
which will peak next month with Diwali.
