PRECIOUS-Gold edges up on weaker dollar, dovish U.S. Fed policy bets

* U.S. Fed's policy announcement on Wednesday
* COVID-19 vaccine hopes lift equities
* Interactive graphic tracking global spread of coronavirus:
open
https://tmsnrt.rs/3aIRuz7 in an external browser

(Updates prices)
By Nakul Iyer
Sept 14 (Reuters) - Gold edged higher on Monday, helped by a
weaker dollar and expectations that the U.S. Federal Reserve
will reiterate its dovish monetary policy stance this week
Spot gold XAU= was up by 0.1% at $1,943.58 per ounce by
1135 GMT. U.S. gold futures GCv1 rose 0.1% to $1,950.10 per
ounce.
"Gold is firm on the basis that the Fed could adopt a
further dovish message with respect to average inflation
targeting," said Michael Hewson, chief market analyst at CMC
Markets UK.
"If you want to have a policy of average inflation
targeting, you're going to have to go into detail as to how you
are going to arrive at that particular outcome."
The dollar .DXY retreated on Monday, bolstering gold's
appeal for investors holding other currencies, ahead of the
Fed's policy decision due on Wednesday. USD/
"If inflation forecasts remain at 2% or below, this could
offer gold a tailwind as the zero-yielding metal thrives in a
low-interest rate environment," said FXTM analyst Lukman
Otunuga.
Market participants are also waiting for the Bank of Japan
and the Bank of England's policy decisions due on Thursday.
Investors also took stock of uncertainty surrounding the
UK's Brexit deal, as Prime Minister Boris Johnson's plan
breaching parts of the treaty faces vote in parliament later in
the day.
Capping gold's gains, AstraZeneca Plc AZN.L resumed its
Phase-III trial, rekindling hopes for a potential vaccine
against COVID-19 and giving a boost to global stock markets.

Gold is likely to remain trapped in a range in the near term
due to the conflicting forces buffeting the commodity with major
headwinds in the form of rising vaccine hopes and positive
economic data from major economies, FXTM's Otunuga said.
Silver XAG= gained 0.3% at $26.83 per ounce, platinum
XPT= rose 1.3% to $937.35, while palladium XPD= slipped 0.2%
to $2,315.29.