Gold prices were holding below $1,200 an ounce on Wednesday as investors awaited the outcome of the Federal Reserve’s policy meeting later in the day.
Investors remained cautious ahead of the Fed’s policy statement, as speculations revolved around the prospects for a U.S. interest rate (which are still at historic lows) hike next year.
Gold prices remain in a state of stability ahead of the Fed’s decision, and after two days of violent movement in conjunction with the volatility in stock markets and crude oil.
If the Fed indicated that low interest rates should continue for a longer period, this will inflect gold prices positively due to investor’s concerns regarding the US economy.
In case of positive outcomes from the Fed’s meeting about raising interest rates, this will pressure the precious metal and keep it below $1,200 an ounce for a longer period.
Spot gold consolidated around $1196 an ounce at 10:06 GMT.