Dollar Strength Weighs on Gold Prices Ahead of Fed Decision

Gold prices slipped on Tuesday as the US dollar strengthened to near one-month highs. The precious metal fell 0.7% to $4,049.12 an ounce by 23:50 ET (03:50 GMT), while its counterpart fell a similar amount to $4,049.10.

The Federal Reserve's policy decision and Chair Kevin Warsh's comments are being closely watched for clues on the outlook for interest rates. Markets broadly expect the Fed to leave interest rates unchanged when its two-day meeting concludes on Wednesday.

Traders have increased bets that policymakers could resume tightening later this year, with markets pricing roughly a 40% chance of a rate hike this week and an 80% probability of a September increase. Higher interest rates tend to reduce the appeal of non-yielding bullion.