2023.06.1210:09:00UTC+00Gold Edges Higher As Dollar Weakens Ahead Of Fed Decision

Gold prices were flat to slightly higher on Monday as the dollar weakened ahead of key central bank meetings due this week.

Spot gold edged up 0.2 percent to $1,965.47 per ounce, while U.S. gold futures were up 0.1 percent at $1,979.50.

The dollar was down against its peers ahead of an eventful week.

Traders will pay close attention to the Federal Reserve's monetary policy meeting scheduled from 13th June to 14th, with the U.S. central bank expected to pause its recent interest rate increases.

The Fed's accompanying statement as well as key U.S. consumer inflation data will be key as investors look for clues about the outlook for rates.

CME Group's FedWatch Tool currently indicates a 71.2 percent chance the Fed will leave rates unchanged on Wednesday, but a 28.8 percent chance of another quarter point rate hike in July.

Meanwhile, more Chinese banks cut deposit rates, signaling monetary easing ahead. There is a chance of China cutting its medium-term lending facility on Thursday.

Elsewhere, analysts expect the European Central Bank to hike rates by 25 bps on Thursday while the Bank of Japan is likely to maintain its current loose policy settings on Friday.

In economic releases, a report on U.S. consumer inflation expectations for May and monthly budget statement for the month of May will be out in the New York session.

U.S. reports on retail sales, industrial production and consumer sentiment may attract attention later in the week.