Gold Holds Steady Ahead of Fed Decision

Gold prices held steady near $4,029 an ounce on Wednesday as investors awaited the Federal Reserve's policy decision and comments from Kevin Warsh for clues on inflation and interest rates.

The market is fixated on the tone of the Fed statement and press messaging, rather than just the rate move itself. OANDA's Kelvin Wong noted that gold needs 'less hawkish' language from the Fed to shake off its recent bearish trend.

The expectation of higher policy rates for a longer period makes cash and bonds more attractive, increasing the opportunity cost of holding non-yielding assets like bullion.