By Karen Rodrigues
BENGALURU (Reuters) - Gold prices edged lower on Tuesday as the dollar strengthened following a positive U.S.-North Korea summit, with markets now waiting for a likely interest rate hike by the U.S. Federal Reserve.
Spot gold was down 0.1 percent at $1,297.96 per ounce at 0719 GMT and U.S. gold futures for August delivery were 0.1-percent lower at $1,301.90 per ounce.
"The dollar has been a big driver for some time now and investors are certainly taking more from that than from easing geopolitical risks in recent runs ... I suspect that will be the key driver for the short term," said ANZ analyst Daniel Hynes.
The dollar hit a three-week high against the yen on Tuesday and Asian shares gained as U.S. President Donald Trump and North Korean leader Kim Jong Un signed a "comprehensive" deal at a historic summit aimed at the denuclearisation of the Korean peninsula.
Trump said the closely watched summit with Kim in Singapore was "really very positive" and that he expected the denuclearisation process to start "very, very quickly".
"The market is starting to price in slightly less geo-political risks," Hynes said.
Easing geopolitical worries are bearish for gold as the metal is seen as a safe investment during times of political uncertainty. This coupled with higher interest rates dent the appeal of greenback-denominated, non-interest paying bullion.
The Federal Open Market Committee's (FOMC) is widely expected to raise interest rates in its two-day meeting, which begins later in the day.
"Producer selling in gold continues to cap a definitive move through $1,300-1,305, while Asian buying in the low $1,290s continues to support on dips," he said.
In other precious metals, silver fell 0.1 percent to $16.87 an ounce. It hit a seven-week high of $16.95 on Monday.
Palladium was down 0.2 percent at $1,020 an ounce. Platinum was up 0.2 percent at $905.90. Platinum touched a one-week high of $910.50 in the previous session.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)