Gold halted its rise on Wednesday as the rise in equities lowered safety demand on gold, ahead of the outcome of the Federal Reserve’s policy meeting.
The precious metal climbed to a high of $1122.12 an ounce, while currently trading around 1117.74, compared to the session’s opening at $1119.51.
Asian shares gained today, except the Shanghai Composite Index, tracking strong performance in Europe and the United States.
Standard & Poor’s 500 index rose 1.41 percent, Dow Jones climbed 1.78 percent and Nasdaq Composite soared 1.09 percent.
Brent crude stabilized above $31 a barrel, where it recovered on Tuesday to hit a peak of $33.48 causing improvement in investor’s sentiment.
Since the beginning of the year, gold has been benefitting mainly from safety demand, as physical demand is still not strong enough.
Fed monetary decision
Eyes will focus on the Federal Reserve’s two-day meeting ending on Wednesday, where analysts predict policymakers to focus on the impact of the challenges stemming from emerging markets.
The Fed is predicted to leave interest rates at 0.25-0.50 percent, where the volatile start of this year will probably prompt the Fed to postpone adapt a slow rate increase path.
Forecasts that the Fed would hike its interest rate in March have dropped, putting some pressure on the U.S. dollar.
The dollar retreated for a third straight session against a basket of major currencies to hit a low of 98.98, according to the dollar index.
However, gold failed to take advantage of the drop in the green currency.
