Gold Rebounds on Weaker Dollar Ahead of Fed Meeting

Gold prices have rebounded slightly after falling for three consecutive sessions, thanks to a weaker US dollar. Spot bullion rose by 0.4% to $4,374.32 an ounce as of 21:33 ET (01:33 GMT), while the dollar index fell to 98.82.

The rebound comes as the Federal Reserve's policy meeting is just around the corner, with markets still pricing in a roughly 60% chance of a rate hike this month. Higher interest rates typically weigh on gold, as investors have more incentive to hold income-generating assets when bond yields rise.

However, ANZ analysts suggest that central-bank buying has provided an important source of underlying demand for gold, despite rising energy costs and higher bond yields. China's central bank bought about 650,000 ounces of gold in August, its largest monthly addition since 2023.