Gold prices pulled back slightly in Wednesday’s early Asian trading, with investors cautious ahead of the U.S. Federal Reserve’s interest rate decision and policy outlook scheduled later in the day.
Spot gold was down 0.4% at $3,673.38 per ounce by 02:40 ET (06:40 GMT), after reaching a historic high of $3,702.95 on Tuesday. U.S. December gold futures mirrored the move, slipping 0.4% to $3,710.77 per ounce.
Fed expected to cut rates
Markets are pricing in a 25 basis point reduction in the federal funds rate to a 4.00%-4.25% range. Attention now turns to the Fed’s updated “dot plot” and remarks from Chair Jerome Powell, as investors look for signals on future rate cuts into 2026. Lower interest rates generally favor gold by reducing opportunity costs, weakening the dollar, and boosting its appeal as a safe-haven asset.
“Continued concerns over the Fed’s independence will also remain the focus for the global market looking ahead,” noted ING analysts. The U.S. Dollar Index hovered near 11-week lows, providing additional support for bullion.
Gold has surged over 40% this year amid trade tensions, geopolitical uncertainty in the Middle East and Ukraine, and ongoing central bank buying, analysts said.
Other metals retreat
Precious and industrial metals were mostly weaker. Silver futures dropped 1.5% to $42.26 an ounce, platinum fell 0.3% to $1,400.60 per ounce, London copper eased 0.5% to $10,084.20 a ton, and U.S. copper declined 0.7% to $4.67 a pound.
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