Gold remains lower after Empire State data; Fed meeting eyed

Gold futures edged mildly lower in rangebound trade during U.S. morning hours on Monday, as investors stuck to the sidelines ahead of the Federal Reserve’s upcoming policy meeting on Wednesday.

On the Comex division of the New York Mercantile Exchange, gold futures for August delivery traded at USD1,383.85 a troy ounce during U.S. morning hours, down 0.3% on the day.

Comex gold prices held in a range between USD1,380.15 a troy ounce, the daily low and a session high of USD1,391.35 a troy ounce.

Gold futures were likely to find support at USD1,366.25 a troy ounce, the low from June 11 and near-term resistance at USD1,401.05, the high from May 28.

Gold prices remained lower after the Federal Reserve Bank of New York said that its general business conditions index rose to 7.8 in June from a reading of minus 1.4 in May.  

Analysts had expected the index to improve to minus 0.5 in June.

The Empire State index is of interest to traders primarily because it is seen as an early forecast of the national Institute for Supply management factory survey.

Meanwhile, investors remained cautious amid ongoing speculation over whether the Fed will begin to unwind its easing program in the coming months.

Moves in the gold price this year have largely tracked shifting expectations as to whether the U.S. central bank would end its bond-buying program sooner-than-expected.

An exit from the stimulus would deal a heavy blow to gold, which has thrived on demand from investors who buy gold to hedge against the inflationary risks of loose monetary policies. 

Elsewhere on the Comex, silver for July delivery fell 0.8% to trade at USD21.77 a troy ounce, while copper for July delivery shed 0.4% to trade at USD3.188 a pound.