Gold rises as markets anticipate rate cuts

BENGALURU, July 24 (Reuters): Gold prices rose on Wednesday on expectations of monetary policy easing from major central banks to shore up the global economy though a stronger dollar curbed gains.

Spot gold was up 0.7 per cent at $1,426.62 per ounce as of 0951 GMT, but was still short of last week's peak at $1,452.60.

US gold futures for August delivery rose 0.4 per cent to $1,427.00 per ounce.

"Continued strong investment interest and buying in gold, expectations of upcoming rate cuts, high geopolitical tensions regarding Iran and a gloomy global economic outlook" are propping up gold prices today, according to Commerzbank analyst Carsten Fritsch.

The European Central Bank (ECB) is expected to signal easier monetary policy when it meets on Thursday. Investors are also looking ahead to the US Federal Reserve's July 30-31 policy meeting at which it is expected to cut its overnight benchmark lending rate.

Futures remain 100 per cent priced for a rate cut of 25 basis points from the Fed next week, and even imply an 18 per cent chance of 50 basis points.

Concerns about tepid economic growth have prompted central banks around the world to review their stance on monetary policy. The IMF on Tuesday lowered its forecast for global growth this year and next, warning that more US-China tariffs, auto tariffs or a disorderly Brexit could further slow growth, weaken investment and disrupt supply chains.