Gold Holds Steady Ahead of Fed Rate Hike Decision

Gold prices remained steady on Tuesday after touching a more than one-month low in the previous session, as investors await cues from the US Federal Reserve's policy decision. The Fed is set to announce its policy decision at 1800 GMT on Wednesday following a two-day meeting.

The market is betting heavily that Fed policymakers will lift their benchmark rate by a quarter of a percentage point to a 3.75 per cent-4.00 per cent range, according to IG market analyst Tony Sycamore.

Sycamore noted that how Fed Chair Kevin Warsh frames the hike will be more important than the hike itself for gold. 'If he casts it as the start of a meeting-by-meeting tightening cycle, that would be a hit to gold and to risk assets overall,' he said.