Gold Prices Hold Near Three-Week Lows Ahead of Fed Decision
Gold prices remained near three-week lows in Asian trading on Wednesday, as easing U.S.-China trade tensions and anticipation of a Federal Reserve rate cut weighed on demand for the safe-haven metal.
Spot gold inched 0.2% higher to $3,957.42 per ounce as of 01:40 ET (05:40 GMT), while U.S. gold futures slipped 0.1% to $3,977.76.
The precious metal has fallen sharply over the past two days, touching its lowest level since early October.
Markets Await Fed Rate Cut and Guidance
The Federal Reserve’s two-day policy meeting, which began on Tuesday, is expected to conclude later in the day with a 25-basis-point rate cut.
While lower interest rates typically support gold, investors are focused on Fed Chair Jerome Powell’s comments for clues about future policy.
If Powell signals a slower pace of rate cuts or continued concerns over inflation, higher real yields and a stronger U.S. dollar could further limit gold’s upside.
Trade Optimism Weighs on Safe-Haven Demand
Gold’s recent weakness was also driven by positive trade developments between the U.S. and China.
A new framework agreement on tariffs and rare-earth export controls has raised hopes of a lasting improvement in relations.
Additionally, President Donald Trump said he plans to cut a 20% tariff on Chinese imports related to fentanyl precursor chemicals, ahead of his summit with President Xi Jinping in South Korea on Thursday.
After a stop in Tokyo, Trump arrived in Gyeongju, South Korea, on Wednesday for talks with President Lee Jae-Myung.
These signs of easing trade and geopolitical risk have reduced demand for safe-haven assets like gold, contributing to the recent pullback from record highs.
Other Metal Markets Remain Subdued
Trading across other precious and industrial metals was mostly muted on Wednesday, as investors reduced exposure before the Fed announcement.
Silver futures edged 0.3% higher to $47.45 per ounce, while platinum futures fell 0.6% to $1,575.80 per ounce.
On the London Metal Exchange, benchmark copper futures rose 0.2% to $11,053.20 a ton, while U.S. copper futures gained 0.3% to $5.18 a pound.
