Gold Bounces as Fed Rate Hike Looms Ahead of Decision

Gold prices rose in European trading on Wednesday for the first time in three sessions, starting to recover from a six-week low as buying emerged at lower levels. This is supported by a weaker US dollar and a retreat in the 10-year US Treasury yield from its highest level in 19 years.

The Federal Reserve concludes its policy meeting later today, with markets pricing in a 92% probability of a 25-basis-point interest rate hike. This would be the first increase in US borrowing costs since July 2023, as policymakers seek to contain mounting inflationary pressures in the United States.

Gold prices rose 1.1% to $4,341.06 an ounce, from an opening price of $4,293.91, after recording a low of $4,275.60. The US Dollar Index fell more than 0.1% on Wednesday, retreating from a two-week high and heading for its first loss in three sessions.