PRECIOUS-Gold firms as investors buy the dip ahead of Fed's meeting minutes
By Anushree Mukherjee
May 28 (Reuters) - Gold firmed on Wednesday as investors bought the dip after prices declined in the previous session, while markets awaited minutes of the Federal Reserve's latest policy meeting and economic data for insights on the U.S. interest rate outlook.
Spot gold XAU= was up 0.4% at $3,312.15 an ounce as of 1204 GMT. Prices fell below the $3,300 level and hit a low of $3,285.19 in the previous session.
U.S. gold futures GCcv1 rose 0.3% to $3,310.60.
"Gold is rebounding mainly due to bargain hunting after a sharp drop in the previous session," said Jigar Trivedi, senior commodity analyst at Reliance Securities.
"Markets are also in a wait-and-watch mode ahead of the Fed minutes, prompting position adjustments."
Minutes of the Federal Reserve's latest policy meeting were due later in the day, followed by the U.S. PCE data for April, due on Friday. A slew of Fed officials are also speaking this week, potentially offering further insights into monetary policy.
"Gold could climb on lower-than-expected PCE prints that ease stagflation fears while paving the way for more Fed rate cuts," said Han Tan, chief market analyst at Exinity Group.
The Fed at its May 6-7 meeting undercut expectations that it would change its policy interest rate anytime soon. Minutes from that session due later in the day may show just how firmly policymakers are holding onto their current wait-and-see approach.
The Fed has kept its policy rate at 4.25%-4.50% since December as officials wait for clearer insights into the economy.
Policymakers are also dealing with market volatility caused by U.S. President Donald Trump's fluctuating remarks on negotiations with the country's trading partners.
BNP Paribas expects U.S. gold futures GCcv1 to rise to $3,685 in the third quarter and to $3,850 in the fourth quarter on average.
Spot silver XAG= was down 0.2% at $33.24 an ounce, platinum XPT= firmed 0.9% to $1,089.22 and palladium XPD= fell 0.4% to $974.28.
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