Gold prices moved higher in Asian trading on Wednesday as investors stepped in to buy the recent dip following a decline of more than 2% in the previous session. Market participants are now turning their attention to upcoming signals from the Federal Reserve on its monetary policy outlook.
Spot gold gained 1.2% to $4,934.16 per ounce by 00:58 ET (05:58 GMT), while U.S. gold futures advanced 1% to $4,954.91 per ounce.
Trading activity remained relatively subdued across Asia due to Lunar New Year holidays in several major markets, which limited overall price volatility.
US–Iran talks and Fed minutes in focus
Gold had fallen sharply on Tuesday as risk appetite improved amid signs of progress in U.S.–Iran negotiations. Reports that both sides had reached an understanding on key “guiding principles” raised hopes of a diplomatic breakthrough, reducing demand for gold as a traditional safe-haven asset.
The decline was further pressured by a stronger U.S. dollar and diminishing expectations of early interest rate cuts. The US Dollar Index rose 0.1% during Asian trading after climbing 0.3% in the previous session. A firmer dollar typically weighs on gold because it makes the metal more expensive for holders of other currencies.
Investors are now awaiting the release of minutes from the Federal Reserve’s January meeting, due later Wednesday. The minutes may provide fresh insight into the timing and scale of potential monetary easing.
Attention is also focused on Friday’s U.S. personal consumption expenditures (PCE) price index report, the Fed’s preferred measure of inflation. The data could significantly influence expectations for future interest rate decisions.
Higher interest rates generally reduce the appeal of non-yielding assets such as gold, while expectations of policy easing tend to support prices.
Other metals advance
Broader metal markets also traded higher. Silver surged nearly 3% to $75.77 per ounce, and platinum rose 2% to $2,060.60 per ounce.
In base metals, benchmark copper futures on the London Metal Exchange increased 1% to $12,705.20 per ton, while U.S. copper futures edged up 0.3% to $5.69 per pound.
