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Gold hits 6-week low hit by firm dollar, ETF eases

Gold prices fell to a six-week low on Tuesday, with firmness in the dollar sapping demand as investors awaited the Federal Reserve’s two-day policy meeting starting later in the day and its economic outlook.

The dollar was firmer against the euro and most other major currencies except the yen after a broad sell-off in U.S. stocks on Monday raised doubts about the economic recovery, with gloomy World Bank forecasts adding to weak market sentiment.

Gold has often benefited from a similar sense of investor risk aversion, but traders said the dollar’s strength was instead weighing on bullion at the moment.

A stronger dollar also makes dollar-denominated assets appear more expensive.

“Right now, market players are closely watching the dollar given … read more ->