Gold eases from record peak; Fed decision in focus
Gold slightly eased on Wednesday, as some profit-booking kicked in after prices scaled a record peak, while focus shifted to U.S. Federal Reserve policy decision due later in the day.
Spot gold fell 0.2% to $3,027.89 an ounce, as of 0930 GMT, after hitting an all-time peak of $3,045.24 earlier in the session.
U.S. gold futures shed 0.1% to $3,036.60.
There is a possibility of profit booking because the price rally was quite sharp, but "it's possible for prices to move beyond $3,050 level driven by market fears in terms of geopolitics," said Soni Kumari, a commodity strategist at ANZ.
Gold, considered a safe investment amid periods of uncertainties, has scaled 15 record highs so far this year.
Investors are worried about an economic slowdown and elevated risks of recession due to U.S. President Donald Trump's tariff policy. While, conflict in the Israel has resumed after attacks on the Gaza Strip.
"Any price dips likely to attract strong buying interest. Until the economic effects of tariffs become clearer, the gold rally appears poised to continue," said Zain Vawda, market analyst at MarketPulse by OANDA.
Trump floated plans of reciprocal and sectoral tariffs that will be imposed on April 2.
Focus is also on the U.S. central bank policy decision due at 1800 GMT followed by Fed Chair Jerome Powell's comments.
"A hawkish FOMC statement from Fed Chair Powell could disrupt the rally, but such a setback may likely be short-lived," said Vawda.
The Fed is expected to maintain its benchmark interest rate within the 4.25%-4.50% range. Money markets currently see a 98% chance of U.S. rate cut in June, according to CME FedWatch Tool.
Gold becomes more attractive when interest rates are low as it is a non-yielding asset.
Spot silver dropped 1.1% to $33.64 an ounce, platinum lost 1% to $987.20 and palladium fell 0.8% to $959.25.
