June 29, 2006	Thursday	Jumadi-ul-Sani 2, 1427

LONDON, June 28: Gold inched higher on Wednesday ahead of a two-day US Federal Reserve meeting that will offer signals on the course of interest rates and determine the metal's direction.

Generally we are ranging fairly comfortably after what happened yesterday, a trader said.

Gold hit a two-week high of $595.60 an ounce on Tuesday before reversing course and ending lower as players squared off positions before the June 28-29 meeting.

Gold as well as the other metals in the precious complex seem comfortable in their current ranges, with fluctuations in the dollar and energy markets providing much of the intra-day direction ahead of this week's Fed rate decision and month/quarter/half-year end, James Moore of TheBullionDesk.com said.

Spot gold stood at $583.10/584.10 an ounce at 0945

The Fed was widely seen lifting overnight rates for a 17th straight time on Thursday to 5.25 per cent from 5 per cent.

Gold lacks direction. Trading is in a big range and the market needs to find its path. I am not sure which way it will go, but I don't think we will re-challenge recent peaks any time soon, a European trader said.

The market was also looking beyond this week's Fed meeting to try to gauge from statements whether the US central bank planned further interest rate increases after this week.

Higher US interest rates support the dollar and may diminish gold's allure as an alternative investment.

Gold set a 26-year high of $730 on May 12 but had largely been on a downhill track ever since.

Resistance at $600, which coincides with the 100-day moving average, is likely to provide some stiff resistance in the interim as the market continues to hold in consolidation in a trading range of $550-$600, Standard Bank said in a report.

In other precious metals, silver, which had mirrored gold's moves on Tuesday, was at $10.33/10.43 an ounce from $10.23/10.33.

Platinum dropped to $1,183/1,188 an ounce from $1,190/1,196 late in New York. Palladium fell to $307/312 an ounce from $314/318.—Reuters