The prices of gold rose on Wednesday as market players looked ahead a meeting of the Federal Reserve is likely to result in the first such increase interest rates in the United States in nearly a decade.
Gold for February delivery on the Comex Exchange jumped $11.80, or 1.1%, to trade at $1,073.30 a troy ounce.
Gold gained as much as 0.5 per cent to $1,066.55 an ounce. The precious metal on Monday dropped to $1,058.95, the lowest since December 4.
The Fed is expected to raise interest rates by 25 basis points at the end of its policy meeting at 2:00 pm on Wednesday. The Fed will also release its latest forecasts for growth and financial interest rates.
Fed President Janet Yellen is to perform what will be a press conference followed by near-30 minutes after the publication of the statement of the Federal Reserve.
With a rate hike and higher prices in part, market participants now target how fast the Fed will tighten monetary policy in 2016.
The yellow metal is on track to a third annual decrease as the focus remains on the prospects for the start of the higher rates, which buffer its appeal as bullion not pay interest.
The gold futures contract traded on the MCX has been stuck inside a narrow range after its sharp rally in the first week of this month.
It is currently trading near the lower end of the range at Rs 25,470.
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