Gold rose on Tuesday ahead of the U.S. Federal Reserve kicked off its March FOMC meeting. The US central bank is expected to remain dovish as it keeps its benchmark rate unchanged. The focus will be on the language on the statement and the words from Fed Chair Jerome Powell.
The Fed quickly put the brakes on its path to rate normalization and will remain patient awaiting better economic performance. US indicators have been mixed and with macro headwinds rising in March the yellow metal is well positioned to be the beneficiary if investors seek the safety of gold if Brexit negotiations take a volatile turn.
US-China trade negotiations hit a rough patch and with Chinese pushback could come further delays to a full agreement. Trade Representative Lighthizer and Treasury Secretary Mnuchin will fly to Beijing Next week hoping to get negotiations back on track.
Uncertainty of the negotiations have made the greenback rise as risk aversion boosted the dollar.