Gold slips as firm dollar weighs; focus turns to Fed meeting

Gold prices edged lower on Tuesday, pressured by a stronger dollar, while markets looked to the Federal Reserve's upcoming policy decision for clues on the interest rate outlook. Spot gold fell 0.5% to $4,056.03 per ounce by 0110 GMT. U.S. gold futures for August delivery lost 0.5% to $4,056.70.

President Donald Trump said on Monday the United States was having "good talks" with Iran and there was a chance of a deal over their conflict, but warned that U.S. strikes would resume if the negotiations failed to deliver. The dollar held near a one-month high as traders weighed chances of a rate hike at the Federal Reserve's upcoming meeting. The U.S. Federal Reserve will begin its two-day policy meeting on Tuesday, and is expected to hold interest rates steady on Wednesday. Expectations for a rate hike of at least 25 basis points are pegged at 36.3%, up from 16% a week ago. Markets are pricing in an 81% chance for a hike at the central bank's September meeting. President Donald Trump on Monday called on the Federal Reserve to lower interest rates, saying the U.S. should have the lowest interest rate in the world. China's net gold imports via Hong Kong more than doubled year-on-year in June, but slipped over 5% from the previous month. Gold Fields submitted a "lease-renewal proposal" to Ghana this month for its Tarkwa.