Gold Price Hits One-Week Low Amid Hawkish Market Expectations

Gold prices fell to a one-week low on Tuesday as investors waited for the Federal Reserve's interest rate decision and Chair Jerome Powell's remarks. The US dollar held steady near a one-month high, making gold less attractive to buyers holding other currencies.

The market expects the Fed to lean hawkish, fueling rate hike expectations and a stronger dollar that further pressures gold prices. David Meger, director of metals trading at High Ridge Futures, noted: 'Energy prices remain elevated and are still an inflation risk that Fed officials are watching.'

Gold has traditionally been viewed as a long-term hedge against inflation, but rising interest rates typically work against such non-yielding assets. Investors are now focused on the Fed's rate decision on Wednesday and Powell's remarks.