Gold and Silver Prices Slide Ahead of Fed Policy Decision

Gold and silver prices declined on Tuesday (July 28) as investors grew cautious ahead of the US Federal Reserve's policy decision, while a stronger dollar reduced the appeal of precious metals.

The COMEX gold price fell to $4,045.20 per ounce, down 0.78%, while COMEX silver slipped 2.16% to $57.445 an ounce in early trade. The decline comes as markets await the outcome of the Federal Reserve's two-day policy meeting, which begins on Tuesday (July 28).

While the central bank is widely expected to keep interest rates unchanged this week, traders are pricing in the possibility of a rate hike in the coming months. According to CME FedWatch data, markets now assign a 36.3% probability of a 25-basis-point rate hike, up sharply from 16% a week ago.

Prithviraj Kothari, Managing Director of RiddiSiddhi Bullions and President of the India Bullion and Jewellers Association, identified immediate support for gold in the $3,950-$4,000 an ounce range and resistance around $4,150 an ounce. He also noted that stronger US economic data boosted expectations of another Federal Reserve rate hike, strengthening both the dollar and Treasury yields.