fed: Gold flat as investors await clarity on Fed policy

Gold prices were little changed on Tuesday as investors sought clarity on whether the US Federal Reserve would pause after a widely expected interest rate hike in May.

FUNDAMENTALS

* Spot gold was flat at $1,994.85 per ounce, as of 0027 GMT. US gold futures were also unchanged at $2,006.50.

* Gold prices fell to their lowest in nearly two weeks on Monday after data showing manufacturing activity in New York state increasing for the first time in five months fueled bets of a 25-basis-point rate hike by the Fed at its May meeting, and boosted U.S. Treasury yields and the dollar.

* The CME FedWatch tool shows markets are pricing in a 91% chance of a 25 basis-point hike in May.

* Other data on Monday showed confidence among US single-family homebuilders improved for a fourth straight month in April.

* Investors will keep a close eye on comments from Fed officials this week before they enter into a blackout period from April 22 ahead of the Fed’s May 2-3 meeting. * Gold is considered a hedge against inflation and economic uncertainties, but higher interest rates dim non-yielding bullion’s appeal.

* SPDR Gold Trustthe world’s largest gold-backed exchange-traded fund, said its holdings fell 0.22% to 925.70 tons on Monday from 927.72 tons on Friday.

* Spot silver dipped 0.4% to $25.01 per ounce, platinum edged up 0.1% to $1,049.13 and palladium was up 0.1% at $1,561.36.