Quick overview

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The yellow metal remained unchanged as investors waited for the Federal Reserve’s policy announcement later in the day and assessed trade uncertainty.

Spot gold and gold futures saw a slight decline of 0.1 percent to $3,323.66 and $3,378.62 per ounce, respectively. Due to trade uncertainty ahead of President Donald Trump’s tariff deadline of August 1, bullion saw modest gains in the previous session. However, in the last few weeks, the commodity has dropped as recent U.S. trade developments reduced the demand for safe-haven assets.

Most European goods now only pay a 15 percent tariff, down from the initially threatened 30 percent, under a US-EU trade agreement announced last weekend. While some concerns about a worsening trade war were eased by recent developments in US trade deals with the EU, it strengthened the U.S. dollar. Gold suffered as a result, becoming more expensive for foreign buyers.

The US Dollar Index held steady on Wednesday. Markets remain tense ahead of the August 1 tariff deadline.  This looming timeline dampens market optimism and keeps a moderate level of safe-haven demand for gold despite trade progress.

Analysts noted that, in the face of growing risk appetite, tariff-driven trade agreements tend to favor the dollar, thus reducing the appeal of gold. The Federal Reserve’s two-day policy meeting, which ends Wednesday, is the focus for investors. It is expected that the central bank will keep interest rates between 4 and 25 percent. Traders will examine the accompanying document closely.