Gold eases-off 2-week highs in Asia, below $ 1130

FXStreet (Mumbai) - Gold price on Comex took a breather in its rally in the mid-Asian trades, retreating from fresh two-week highs reached after the Fed kept the interest rates on hold at its latest policy meeting on Wednesday.

Gold drops from 1131.70 highs

Currently, gold trades marginally lower at 1127.50, miring near fresh session lows. Gold prices retreated slightly this session as markets resorted to profit-taking after the recent upsurge backed by Fed’s status- quo.

Moreover, the recovery seen in the greenback against its major peers post the FOMC slump also dragged the gold lower in Asia. The US dollar index, the virtual gauge of the greenback’s relative strength, trades 0.16% higher at 94.79, recovering from three-week lows struck at 94.48 overnight.

The Fed decided to keep monetary policy settings unchanged on late Wednesday, with global financial developments deterring the bank from what would have been its first rate hike in more than nine years.

The decision boosted the gold bulls as the delay in rate hike bolstered the demand for non-interest-paying assets like bullion and dragging the US dollar sharply lower, making dollar-denominated assets therefore more attractive for investors paying in other currencies.

Gold Technical Levels

The metal has an immediate resistance at 1133.50 (Sept 17 High) and 1140 levels. Meanwhile, support stands at 1123.60 (Aug 28 Low) below which doors could open for 1117.10 (Sept 17 Low) levels.