Range Bound Ahead Of FOMC; Little Moved On Growth Worry

Gold sits virtually unchanged to print ~$1,717/oz at typing after sticking to a ~$4/oz range, with the precious metal seeming content to operate around the $1,720/oz handle in recent sessions.

• To recap, gold closed ~$2/oz lower on Tuesday amidst an uptick in the USD (DXY) and U.S. real yields, with its daily trading range narrowing for a third consecutive day, as proximity to the upcoming FOMC decision (with a 75bp hike fully priced in) again likely contributed to its muted moves.
• Gold was little-changed in the wake of the IMF’s downward revision to global GDP growth for ‘22 (from 3.6% to 3.2%), with the organisation also stating that it would be "increasingly challenging" for the U.S. to avoid a recession.
• OIS markets currently point to ~78bp of tightening for the Jul FOMC, with a cumulative ~139bp priced in through to the Fed’s Sept meeting, pointing to ~56% odds of a 75bp hike then. Focus later will be on the Statement and comments from Fed Chair Powell, particularly over cues to the size of the next hike.
• From a technical perspective, short-term gains in gold still appear to be corrective, following its bounce off $1,681.0/oz last Thursday. Previously outlined levels remain intact, with initial support situated at $1,697.7/oz (Jul 14 low), and resistance seen at $1,745.4/oz (Jul 13 high).