Gold Rises as Treasury Yields Decline and Markets Await Fed Decision
Gold prices edged higher on Wednesday, supported by a decline in U.S. Treasury yields and a slight weakening of the U.S. dollar, as investors await the Federal Reserve's policy statement for signals on the future path of interest rates.
As of 02:36 GMT, spot gold rose by 0.1% to $3,329.27 per ounce, while U.S. gold futures also gained 0.1%, reaching $3,326.90.
The increase in gold prices comes amid a pullback in the U.S. dollar index from its highest level in over a month. Meanwhile, benchmark 10-year Treasury yields remained stable, hovering near their lowest levels in a month—conditions that typically enhance the appeal of non-yielding assets like gold.
Markets widely expect the Federal Reserve to keep interest rates unchanged at today’s meeting, although expectations persist for a possible rate cut in September due to ongoing economic uncertainty and moderated inflation pressures.
Gold generally performs well in low interest rate environments, as the opportunity cost of holding the metal—relative to interest-bearing assets—decreases.
In other precious metals, silver slipped 0.1% to $38.14 per ounce, platinum declined 0.6% to $1,386.31, while palladium rose 0.4% to $1,262.99.
