Gold prices held near flat territory on Monday as traders paused for clarity ahead of the release of the Federal Reserve’s latest meeting minutes.
The yellow metal, typically sensitive to shifts in U.S. monetary policy expectations, was last up 0.1% at $2,345.20 per ounce. The Fed’s minutes from its May 7 meeting are scheduled for release on Wednesday at 14:00 ET, offering insight into policymakers’ deliberations on inflation and the trajectory of interest rates.
Market participants are closely monitoring the document for signals on whether the central bank may signal a more accommodative stance or reinforce a prolonged higher-for-longer rate environment. Recent economic data, including persistent inflation readings and a resilient labor market, have kept pressure on the Fed to maintain restrictive policy settings.
Analysts at Goldman Sachs noted in a client note that while gold’s near-term direction remains tied to real yields, the upcoming minutes could provide fresh cues on the Fed’s balance of risks between inflation and growth. "The minutes may clarify whether the Fed is leaning toward a more dovish tilt or if hawkish leanings persist," the bank said.
The U.S. dollar, a key driver for gold, was little changed against major peers, with the DXY index holding near 105.10. A stronger dollar typically weighs on dollar-denominated commodities like gold, while a softer greenback tends to support prices.
Investors are also eyeing remarks from Fed officials this week, including speeches from Chair Jerome Powell, for further guidance. Any indication of a potential rate cut later in the year could bolster gold’s appeal as a non-yielding asset.
The Fed’s next policy decision is due on June 12, with markets currently pricing in a roughly 60% chance of a rate cut by September, according to CME Group’s FedWatch tool.
Gold’s consolidation reflects a broader wait-and-see approach among traders, as they assess both domestic and global economic signals before positioning for the next major move.
