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Gold edges higher, all eyes on Fed

Reuters  |  BENGALURU 

By Nithin ThomasPrasad and Vijaykumar Vedala

(Reuters) - Gold inched up on Wednesday as the market waited for direction from the outcome of a two-day U.S. Federal Reserve meeting, with the central expected to hike and give indications on its monetary policy for the rest of the year.

The Fed is scheduled to release its interest rate decision at 2 p.m EDT (1800 GMT) on Wednesday, with Chair Janet Yellen due to hold a press conference 30 minutes later.

Higher rates could boost the dollar, making commodities priced in the greenback more expensive for holders of other currencies.

"Most people have already priced in a in June," said Mark To, head of research at Hong Kong's Wing Fung Financial Group.

"What really matters is the anticipation on further action and whether there will be hints on the extent or the schedule of the shrinkage of the balance sheet as well as other monetary policy actions."

The central could provide more details on its plans to shrink the mammoth bond portfolio it amassed to nurse the economic recovery.

Spot gold was up 0.3 percent at $1,269.45 per ounce by 0426 GMT. On Tuesday, it touched its weakest since June 2 at $1,259.16.

U.S. gold futures for August delivery rose 0.2 percent to $1,271.40 an ounce.

"With geopolitical risk having receded over the last week, gold is now trading on fundamentals and will be ... subject to the nuances of weakness or strength," said Jeffrey Halley, senior market analyst at OANDA.

Meanwhile, the testimony of U.S. Attorney General Jeff Sessions and his refusal to detail conversations with President Donald Trump was deemed a "non-event" by some market analysts.

Sessions' testimony did not provide any damaging new information on Trump, but his refusal to discuss conversations with Trump raised fresh questions about whether the White House has something to hide.

In the wider markets, the remained flat and Asian shares turned mixed on Wednesday as investors everywhere awaited clarity on the Fed's future path.

Among other metals, silver edged up 0.1 percent to $16.88 per ounce. On Tuesday, it hit its lowest since May 19 at $16.68.

Platinum rose or 0.4 percent to $927.85 per ounce, while palladium fell 0.6 percent to $876.95 per ounce.

(Editing by Joseph Radford)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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