Gold set for gain of 5 in January
Silver, platinum, palladium set for monthly fall
Fed policy decision due on Feb. 1

Jan 31 Reuters Gold prices eased on Tuesday, but were en route to their third straight monthly gain, as market participants awaited the U.S. Federal Reserve policy decision later this week.

Spot gold was down 0.4 at 1,915.06 per ounce, as of 0704 GMT. The contract, however, was headed for a monthly gain of 5.

U.S. gold futures were down 0.5 at 1,929.80.

The dollar index held steady but was set for a fourth consecutive monthly drop. A weaker greenback tends to make dollarpriced bullion an attractive bet.

Traders mostly expect the Fed to scale back rate hikes to 25 basis points bps at the end of its twoday policy meeting on Wednesday. The U.S. central bank slowed its tightening pace to 50 bps in December after four straight 75bp hikes.

The gold market has already priced in a 25 bps hike. If the Fed strikes a dovish tone, then it will be positive for gold, said Ajay Kedia, director at Kedia Commodities, Mumbai.

A low interestrate environment decreases the opportunity cost of holding nonyielding bullion.

I expect gold to trade between 1,900 and 1,925 over the next week, said Michael Langford, director at corporate advisory firm AirGuide.

Top gold consumer China39;s economic activity swung back to growth in January, official data showed, as a wave of COVID19 infections passed through faster than expected following the country dismantling its…