Investing.com - Gold was little changed in a familiar trading range on Tuesday, after data showed consumer price inflation in the U.S. was flat in November, while prices excluding food and energy costs inched up modestly.
The U.S. Commerce Department said that consumer prices were unchanged from a month earlier, meeting expectations and following a gain of 0.2% in October. Year-over-year, consumer prices were 0.5% higher from the same month a year earlier, compared to expectations for a 0.4% increase.
Consumer prices, excluding food and energy costs, increased 0.2%, meeting expectations. On an annualized basis, core CPI increased at a rate of 2.0% last month, in line with expectations and up from 1.9% the prior month.
A separate report showed that the Federal Reserve Bank of New York's general business conditions index improved to -4.6 this month from a reading of -10.7 in November. Analysts had expected the index to rise to -6.0 in December.
Meanwhile, the Federal Reserve's all-important two-day monetary policy meeting gets underway. The Fed is widely expected to raise interest rates for the first time in nearly a decade at the conclusion of its two day policy meeting at 2:00PM ET on Wednesday. The central bank will also release its latest forecasts for economic growth and interest rates.
Fed Chair Janet Yellen is to hold what will be a closely-watched press conference 30 minutes after the release of the Fed's statement, as investors look for signals about the path of future rate hikes. Many in the market anticipate the pace of increases to be gradual amid concerns over tepid growth overseas and divergent monetary policies between the U.S. and other nations.
Gold for February delivery on the Comex division of the New York Mercantile Exchange slumped 60 cents, or 0.06%, to trade at $1,062.80 a troy ounce during U.S. morning hours. A day earlier, gold lost $12.30, or 1.14%, after falling to a session low of $1,058.10, the lowest since December 3.
The yellow metal is on track to post an annual decline of 10% in 2015, the third yearly loss in a row, as speculation over the timing of a Fed rate hike dominated market sentiment for most of the year. Expectations of higher borrowing rates going forward is considered bearish for gold, as the precious metal struggles to compete with yield-bearing assets when rates are on the rise.
Meanwhile, silver futures for March delivery dipped 2.0 cents, or 0.15%, to trade at $13.67 a troy ounce. Prices slumped to $13.62 on Monday, a level not seen since August 2009.
Elsewhere in metals trading, copper fell for the second straight day on Tuesday, as market players reduced exposure to risk-related assets ahead of the Federal Reserve's policy meeting.