Gold prices inched higher during Asian trade on Wednesday, attempting to recover from recent sharp losses as investors looked to the Federal Reserve’s policy decision for fresh direction.
By 4:10 pm AEDT (5:10 am GMT), spot gold was up 0.2% at US$3,958.06 per ounce, following a steep correction from record highs of US$4,382.
The move comes as traders engaged in light buying after three consecutive sessions of declines, with markets adopting a cautious stance before the Fed’s announcement.
Gold has shed around 3.5% this week, pressured by a stronger United States dollar and improving risk sentiment across global equity markets.
The metal’s short-term recovery remains fragile, with gains capped by easing U.S.-China trade concerns and the ongoing rally in risk assets.
Investors are closely monitoring the upcoming meeting between U.S. President Donald Trump and Chinese President Xi Jinping in South Korea.
Trump said he expects to lower tariffs on China linked to fentanyl exports, adding, “I think we are going to have a great meeting with Xi.”
The Fed’s interest rate decision remains the main focus for precious metals traders. Markets are widely expecting a 25 basis point cut, following the central bank’s “risk management” reduction in September.
However, attention will centre on the voting composition of policymakers and any signals from Fed Chair Jerome Powell about the pace and depth of future cuts.
The outcome of the Trump-Xi meeting on Thursday is also expected to influence the next major move in gold, potentially setting the tone for risk sentiment into November.
