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 Gold rose to a nine-month high on Thursday on a subdued dollar, as investors held onto the view that the U.S. Federal Reserve would soon end its rate hiking cycle after it announced an expected 25-basis-point increase.

Spot gold was up 0.2% at $1,954.77 per ounce at 0927 GMT, having hit its highest since April 2022 earlier in the session. U.S. gold futures rose 1.5% to $1,955.30.

The U.S. central bank on Wednesday scaled back to a quarter-percentage-point rate increase after a year of larger hikes. It said it had turned a corner in the fight against high inflation, but that "victory" would still require rates to be increased further and remain elevated at least through 2023.

"There's other statements where he (Fed Chair Powell) wanted to try and manage market expectations... But the dovish elements were there enough to continue to push gold higher," said Craig Erlam, a senior market analyst at OANDA.

Gold tends to appreciate on expectations of lower interest rates, which reduce the opportunity cost of holding non-yielding bullion.

"Traders seem willing to bypass what policymakers are saying if the data is favourable," Erlam said.

But if the data becomes less favourable, the case for either ending the rate-hiking cycle or just a couple more rate hikes becomes difficult and could see gold prices correct lower, he added.

Investor attention is now on European Central Bank (ECB) and Bank of England (BOE) interest rate decisions later in the day, with expectations of a 50-basis-point rate hike from each.

The dollar index edged 0.1% lower against its rivals, making dollar-priced bullion more attractive for overseas buyers. [USD/]

Spot silver gained 0.9% to $24.19 per ounce, scaling a one-week high.

Platinum rose 0.8% to $1,011.90 while palladium edged up 0.1% to $1,671.51.