Gold rose on Tuesday as the dollar fell, but remained hemmed into a range at the start of a two-day U.S. Federal Reserve policy meeting which is being closely watched for clues on the outlook for U.S. interest rates.
The dollar slid as much as 0.5 percent against a currency basket, largely due to a bounce in the yen after traders dialed back expectations for how much new stimulus Japanese authorities would inject into an ailing economy.
"The key thing for commodities in the past month is that the macro data in both the United States and China has definitely improved, and that is reflected in the probability of rate hikes," Oxford Economics' director of commodity services Daniel Smith said.
A surge in Western investment helped offset sliding Asian demand in the second quarter, GFMS analysts at Thomson Reuters said, as they hiked their gold price forecast.
Top consumer China's net gold imports via main conduit Hong Kong fell 38.5 percent in June, data released on Tuesday showed.
Reference: Reuters
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