Gold prices gain some ground on softer dollar

Gold prices moved slightly higher on Tuesday, as Monday’s disappointing U.S. data continued to weigh on the greenback and as invesrtors were eying this week’s policy statement by the Federal Reserve.

On the Comex division of the New York Mercantile Exchange, gold futures for June delivery were up 0.17% at $1,257.70.

The June contract ended Thursday’s session 0.13% higher at $1,265.90 an ounce.

Futures were likely to find support at $1,248.20, the low of April 10 and resistance at $1,272.40, Monday’s high.

The dollar weakened after the Institute of Supply Management said on Monday that its manufacturing purchasing managers’ index fell to 54.8 in April from 57.2 the previous month, compared to expectations for a downtick to 56.5.

A separate report showed that U.S. personal spending was flat in March, confounding expectations for a 0.2% rise and after a 0.1% gain.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was little changed at 98.97.

A weaker U.S. dollar usually supports gold, as it boosts the metal's appeal as an alternative asset and makes dollar-priced commodities cheaper for holders of other currencies.

However, U.S. Treasury Secretary Steven Mnuchin said on Monday that economic growth of 3% is achievable in the next two years as the Trump administration is planning to dramatically cut taxes.

Market participants were also eyeing the Federal Reserve’s two-day policy meeting this week. While the central bank is widely expected to hold interest rates, investors were eyeing hints on the pace of future rate hikes.

Elsewhere in metals trading, silver futures for May delivery advanced 0.90% to $16.993 a troy ounce, while copper futures for May delivery tumbled 1.15% to $2.630 a pound.