Gold prices inched down on Wednesday as investors waited for cues from the US Federal Reserve on its interest rate hike trajectory.
Spot gold fell 0.2% to $1,864.22 per ounce by 10:54 am ET (1454 GMT). US gold futures fell 0.4% to $1,864.00.
In the UAE, the cost of 24-karat gold was at Dh225.75 per gram on Wednesday, down from 226.75 on Tuesday. Meanwhile, the price of 22-karat gold fell to Dh212 per gram, 21-karat to Dh202.25 and 18-karat to Dh173.25 in the UAE. Check the latest gold rates here.
The Fed is set to release a policy statement at 1800 GMT, followed by Chair Jerome Powell's news conference. It is expected to raise interest rates by half a percentage point.
While gold is considered an inflation hedge, higher US interest rates and bond yields lift the opportunity cost of holding zero-yield bullion.
"The most important news we will hear is hints of whether (the Fed) will be more hawkish in their tone, potentially leading to as much as a three-fourth of a base point rate hike in June, or will they stick with the more likely half point rate hike scenario currently built into the market," said David Meger, director of metals trading, High Ridge Futures.
The dollar index pulled further away from 20-year highs, while benchmark 10-year Treasury yields held close to multi-year highs.
While "Fed jargon has been quite hawkish over the course of the last several weeks," inflationary pressures are not going away and gold could find support around the $1,850 area, Meger added.
Wider markets stuck to tight ranges, with crude oil jumping on the prospect of a European oil embargo on Russia.
"By now, investors have priced in the financial risks posed by the (Russia-Ukraine) conflict and have reduced some of the fear-based trading as a result," Rupert Rowling, market analyst at Kinesis Money, wrote in a note.
Gold is considered a safe-haven asset during global uncertainties such as the Ukraine war.
Elsewhere, spot silver fell 1% to $22.33 per ounce, platinum rose 0.9% to $970.79 and palladium dropped 0.5% to $2,243.55.
