The gold price once again failed to benefit from the relatively weaker dollar, with the market now awaiting the outcome of the Federal Reserve’s last meeting before the summer break. Spot gold was last at $1,095.00/1,095.80 per ounce, up $1.60 on the previous session, having traded within an intraday range of just $6 so far. The metal is once again failing to benefit from the relatively weaker dollar, which struck its lowest in two weeks on Monday and remains within sight of that mark today. The US currency was last almost unchanged at 1.1080 against the euro. Instead, it appears that much of the market is now looking towards the Federal Reserve’s last meeting before the summer break, which gets underway today. “Regardless of the timing of rate rises, it is clear that they are being priced in right now,� Mitsubishi’s precious metals analyst Jonathan Butler said. “Any hawkish statements from the Fed on Wednesday could push the dollar higher and weigh further on precious metal prices, while an emphasis on caution as the Fed brings an unprecedented experiment in loose monetary policy to an end could see gold and its sister metals regain some recent lost ground,� he added. In other markets, the Chinese stock market rout continued – though not as much as Monday’s 8.5 percent slump – the Shanghai Composite closed down nearly 1.7 percent. European markets have, however, all moved in positive territory. “We assume that the slump in [Chinese] equity markets that began in mid-June and the fall in gold prices themselves will generate increased interest in buying gold in the second half of the year, which should lend support to the gold price,� Commerzbank said in a note. In gold-centric news, China imported just 37.1 tonnes of gold on a net basis in June, according to the Census and Statistics Department of the Hong Kong Government, once again supporting the widely held assumption that demand in one of the world’s largest consumers is faltering. Premiums have been stagnant around $2 on the Shanghai Gold Exchange for some time and have yet to really react to the recent collapse in international prices. “This supports our thesis that physical gold demand in China is cooling due to lower jewellery offtake, amid the economic slowdown and recent stock market rout,� Mitsubishi’s Butler added. “The very healthy levels of turnover on the Shanghai Gold Exchange are somewhat misleading from a physical demand perspective, as much of this represents speculative and trade financing activity, which has been augmented recently by liquidations in order to make margin calls on stock market losses.� In other metals, silver was last up nine cents at $14.61/14.66 per ounce, while platinum was up $3 at $981/986 and palladium was up $7 at $616/621.

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