Gold Prices Dip Toward $4000 Ahead Of Fed Decision

(RTTNews) - Gold prices were sharply lower on Tuesday as traders waited for the Federal Reserve policy decision.

Spot gold fell 1.2 percent to $4,029.23 an ounce while U.S. gold futures were down 1.2 percent at $4,028.35.

The U.S. dollar hovered near a one-month high as expectations of higher-for-longer interest rates countered investor relief over recent declines in global crude oil prices.

The U.S. Federal Reserve is set to announce its monetary policy decision on Wednesday, with analysts expecting no change in interest rates.

Fed Chair Warsh "wants to do the right thing," but is facing a Fed board that might oppose him, President Donald Trump told reporters en route to an event in Michigan on Monday while repeating his long-stated wish for cuts in interest rates.

Elsewhere in Europe, ECB Governing Council member Peter Kazimir has warned that the European Central Bank may need to raise interest rates at least once more to prevent inflation risks from spiraling out of control.

The British pound was little changed ahead of the Bank of England's rate decision on Thursday, with the central bank widely expected to keep interest rates unchanged at 3.75 percent.

Japan's 10-year government bond yield edged higher due to uncertainty over funding for proposed food tax cuts.

Ahead of the Bank of Japan's rate decision due on Friday, Japan's finance minister said the government's relationship with the central bank is 'normal and smooth.'

On the geopolitical front, Brent crude futures fell toward $86 a barrel, marking a third consecutive session of losses after U.S. President Trump said the U.S. was having "good talks" with Iran, raising optimism over the prospects for a negotiated peace deal.

Trump told Axios that he chose to suspend strikes on Iran in order to give negotiations another chance, stressing that he could order a return to expanded military operations if diplomacy fails.

It was said that the talks are being conducted mainly between Iran and Oman, but Qatar, Pakistan, Egypt and Trump's envoys, Steve Witkoff and Jared Kushner, are also actively involved.