Gold prices slipped on Thursday after the dollar steadied after the Federal Reserve concluded a two-days policy meeting and gave an upbeat assessment on the U.S. economy.
Gold futures for December delivery on the Comex division of the New York Mercantile Exchange fell by $0.6, or 0.06%, to $1,227.00 a troy ounce by 1:40AM ET (05:40 GMT).
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The Fed left interest rates unchanged following a two-day policy meeting, as widely expected. The central bank then upgraded its view on the economy.
The committee said it expects that “further gradual increases in the target range for the federal funds rate will be consistent with sustained expansion of economic activity, strong labor market conditions, and inflation near the committee’s symmetric 2 percent objective.”
The U.S. dollar index, which tracks the greenback against a basket of other currencies, gained 0.11% to 94.56 by 12:30AM ET (04:30 GMT).
“The Fed delivered rather hawkish comments in the statement emphasizing the strength of the U.S. economy,” said Osamu Takashima, head of G10 FX strategy, at Citigroup Global Markets Japan.
“There was no big surprise in last night’s statement, but the overall tone was a little bit stronger than last one.”
Meanwhile, Asian markets extended losses on Thursday, with China’s stock markets down more 3% amid renewed trade war fears.
Higher U.S. tariffs on Chinese imports now look increasingly likely after U.S. Trade Representative Robert Lighthizer confirmed President Donald Trump is considering a higher 25% tariff on $200 billion worth of Chinese goods because China refused to meet U.S. demands. Trump previously said U.S. could eventually impose tariffs on all U.S. imports from China.