commodity updates - Gold futures advanced in the domestic and overseas market on Monday as investors eyed the US Federal Reserve’s monetary policy verdict with the world’s top central bank likely to hold off further interest rate tightening, bolstering the lure for the precious metal as a store of value.

Heavy global headwinds which have fueled an American factory slump have raised speculation that the Fed may keep interest rates unchanged at the end of a two-day meet that concludes on Wednesday. The FOMC undertook a maiden interest rate hike since 2006 in December.

Investors will also focus on cues from the central bank over further lift-off in borrowing costs this year amidst heightened global economic uncertainty. Gold, a non-interest bearing asset benefits from easy money policies.Losses in US equities and falling oil prices bolstered the safe haven appeal of the bullion while a weaker dollar boosted the appeal of Gold as an alternative asset. Weaker greenback makes Gold cheaper for those holding other currencies, thus boosting demand.

Gold may trade on a cautious note today ahead of the Fed’s monetary policy decision.

At the MCX, Gold futures for February 2016 contract closed at Rs 26,387 per 10 gram, up by 0.87 per cent after opening at Rs 26,247, against the previous closing price of Rs 26,160. It touched the intra-day high of Rs 26,442.

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