Gold higher ahead of rate decision
Gold holds near 3-week low ahead of pivotal Fed decision on rates.
Gold prices ticked up slightly on Wednesday morning ahead of the U.S. Federal Reserve's closely-watched policy meeting, but remained near the lowest level in over three weeks as the dollar has regained strenght.
Spot gold (XAU/USD) rose 0.2% to $1,983.21 per ounce after weaker Treasury yields lent some support. However, the dollar index edged up 0.1%, making bullion more expensive for foreign buyers.
Markets are awaiting signals from the Fed about potential interest rate cuts in 2024. While investors have priced in a 75% chance of a May rate reduction, Fed chair Jerome Powell's comments at his press conference could impact expectations.
For now, participants are watching to see if policymakers leave rates unchanged in the 5.25%-5.50% range at the conclusion of their two-day meeting today. Lower rates tend to benefit gold, which struggles to compete with yield-bearing assets when borrowing costs rise.
