Investing.com - Gold prices gained in Asia on Thursday as investors parsed the Fed language for signs of a more hawkish view on rate hikes in 2018.
Gold futures for February delivery on the Comex division of the New York Mercantile Exchange rose 0.30% to $1,347.10 a troy ounce.
The Caixin/Markit China manufacturing PMI for January came in at 51.5, meeting an expected steady reading of 51.5 seen on Thursday. On Wednesday, the official manufacturing PMI came in at 51.3, below the 51.5 seen and the 51.6 level in December.
The Federal Reserve left interest rates unchanged at the end of its two-day policy meeting on Wednesday, keeping them in a range between 1.25% - 1.50%.
The Federal Reserve signalled that it would push ahead on its monetary policy tightening path as economic activity has been rising at a solid rate, while inflation remained low but is expected to "move up" in the coming months.
"The Committee expects that, with further gradual adjustments in the stance of monetary policy, economic activity will expand at a moderate pace and labor market conditions will remain strong," The Federal Reserve noted in its monetary policy statement. "Inflation on a 12‑month basis is expected to move up this year and to stabilize around the Committee's 2 percent objective over the medium term."
The somewhat upbeat outlook on inflation comes as data on Monday showed that the Core PCE Price Index, the Fed's preferred measure of inflation, rose 1.5% in December.
Overnight, gold prices eased from session highs on Wednesday. Gold is sensitive to rising U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion.
Some market participants warned, however, that the yellow metal may face a period of weakness as physical gold demand is expected to decline as seasonality is starting to fade ahead of the Chinese New Year.