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Dollar still near one-month trough
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ECB policy decision at 1215 GMT
Oct 27 (Reuters) - Gold prices on Thursday consolidated near the previous session's two-week peak, underpinned by bets that the U.S. Federal Reserve may slow future rate hikes, while caution ahead of economic data and a steady dollar kept a leash on any gains.
Spot gold was little changed at $1,663.30 per ounce, as of 0811 GMT, while U.S. gold futures fell 0.2% to $1,666.20.
The dollar index ticked up 0.1%, but was still close Wednesday's Sept. 20 low. Gold competes with the dollar as a safe store of value, and a dip in the currency makes bullion a more attractive bet for investors.
With rising fears of a recession, investors increasingly expect the Fed to slow rate hikes and this is providing support to gold, said Harshal Barot, a senior research consultant for South Asia at Metals Focus.
"For gold, $1,680-$1,700 is the range that should hold on the upside; only once that breaks can we see sustainable uptrends emerging."
While a fourth straight 75 basis-point rate hike at the Fed's November meeting is widely priced in, there are hopes it may opt for a smaller increase in December.
U.S. rate hikes increase the opportunity cost of holding zero-yielding bullion.
Overnight, the Bank of Canada announced a smaller-than-expected rate hike and investors will now keep a close eye on the European Central Bank's policy decision due later in the day, followed by advance GDP estimates by the U.S. Commerce Department.
If Friday's U.S. personal consumption expenditures number is not wildly hotter than anticipated, gold could test $1,700 and then if the Fed stays "neutral", it could attempt to poke even above that, DailyFX currency strategist Ilya Spivak said.
Spot silver fell 1.2% to $19.39 per ounce and platinum eased 0.1% to $950.75. Palladium climbed 1.2% to $1,987.00. (Reporting by Eileen Soreng and Arundhati Sarkar in Bengaluru; Editing by Rashmi Aich and Subhranshu Sahu)
