Gold Dips Ahead Of Fed Meeting

Gold eased on Tuesday as investors turned their back on the metal ahead this week's Federal Reserve meeting on interest rates, which may offer directions to the dollar and precious metals.

Gold often takes cue from movements in the dollar because of its role as an alternative investments to currencies, stocks and bonds. Trading was thin with Japanese players away for a holiday.

Gold fell to $890.00/891.00 an ounce from $891.65/892.65 late in New York on Monday, when it hit an intraday day high of $895.50 an ounce on speculative buying driven by record high oil CLc1.

The metal was still trading well below a lifetime high of $1,030.80 an ounce hit on March 17, with attempts to revisit the level met by heavy profit taking.

"Everybody is waiting for the Fed," said Ronald Leung, director of Lee Cheong Gold Dealers in Hong Kong.

"I think gold has to stay above these levels before it can charge higher again. The range is still the same at between $880 to $900 for today and tomorrow."

The euro edged up to $1.5653 , while the dollar was steady against the yen 104.13 yen in thin trade as dealers awaited the outcome of the Fed's two-day policy meeting which ends on Wednesday.