Firmer On Tuesday, Awaiting The FOMC Decision

Gold is little changed in the Asia-Pac session, after closing higher (+0.5%) on Tuesday, recovering some of the losses experienced in recent days, which had pushed prices to their lowest level in a week. The market's focus was on the upcoming Federal Reserve interest rate decision scheduled for Wednesday, as well as monetary policy decisions from the ECB and BoJ later in the week.

• While the market has already priced in a 25bp hike for the FOMC meeting today, there remains significant uncertainty about the Fed's outlook. This uncertainty contributed to a rise in US Treasury yields over recent days, as there is a concern that the Fed's stance could turn out to be more hawkish than anticipated.
• Investors are keenly waiting for comments from Fed Chair Powell during the press conference following the rate decision. His statements may provide valuable insights into the central bank's plans for further interest rate increases. Any indication that the Fed is considering additional rate hikes beyond July, such as at its September meeting or later, might exert downward pressure on gold prices.
• Currently, gold has been buoyed by recent inflation data, which indicated that price pressures are easing more rapidly than initially expected.