April 24 Reuters Gold steadied on Monday, helped by a weaker dollar, although prices were stuck in a tight range as traders turned their attention to this week39;s economic data that may influence the U.S. Federal Reserve39;s next policy decision.

Spot gold was mostly flat at 1,983.06 per ounce by 1125 a.m. EDT 1525 GMT while U.S. gold futures were up 0.2 to 1,993.60.

Prices briefly turned positive after the Dallas Fed39;s report showed manufacturing activity in Texas contracted in April, highlighting the economic toll of the Fed39;s rate tightening cycle.

This market is treading water in the short term, waiting on its next piece of economic data that could potentially jolt it in one direction or the other, said David Meger, director of metals trading at High Ridge Futures.

The U.S. dollar eased 0.3, making greenbackpriced bullion more appealing to overseas buyers.

Gold dropped below 2,000 last week on Fed officials39; hawkish remarks and after surveys showing U.S. and euro zone business activity gathered pace in April.

Markets now expect an 89 chance of a 25 basis point Fed hike at its May 2 to 3 policy meeting, according to the CME FedWatch tool.

Higher interest rates raise the opportunity cost of holding nonyielding gold.

While it will take a fresh catalyst to see the price return back above 2,000 an ounce, gold is unlikely to fall below 1,950 any time soon, Kinesis Money analyst Rupert Rowling said in a note.

Investors wait for a key Fedfavoured inflation…