BENGALURU, May 2(Reuters) - Gold prices edged up early Wednesday, having fallen almost one percent in the previous session on the back of a stronger U.S. dollar to hit their lowest level this year.
FUNDAMENTALS
* Spot gold XAU= was up 0.2 percent at $1,306.51 per ounce at 0118 GMT. Gold fell to $1,301.51 in the previous session, its lowest level since Dec. 29.
* U.S. gold futures GCcv1 for June delivery rose about 0.1 percent to $1,307.60 per ounce.
* The dollar index .DXY was steady near a four-month high at 92.446, supported by the outlook for a strong U.S. economy and rising yields amid signs of slowdown elsewhere, especially in Europe. USD/
* The U.S. Federal Reserve is set to hold interest rates steady this week but will likely further encourage expectations that it will lift borrowing costs in June on the back of rising inflation and low unemployment. The U.S. economy is expanding at a 4.1 percent annualized rate in the second quarter as the government said construction spending fell in March and revised up its figure on building activity in February, the Atlanta Federal Reserve's GDPNow forecast model showed on Tuesday. SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, said its holdings fell 0.51 percent to 866.77 tonnes on Tuesday from 871.20 tonnes on Monday. AHEAD (GMT)
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