Gold prices were down on Wednesday as traders wait for a policy decision from the Federal Reserve.
Comex gold futures for August delivery fell 0.44% to $1,218.30 a troy ounce as of 10:30 AM ET (14:30 GMT). Gold has fallen in recent months as a stronger dollar and rising interest weights weighed on the metal.
The Fed Is not expected to raise interest rates later in the day, but a decision and policy statement are released at 2:00 PM ET (18:00 GMT). No news conference is expected. Strong U.S. economic data points to the central bank raising rates in September, with the chance of an increase at 87.8%.
Higher rates are a negative for gold as the precious metal, which does not pay interest, struggles to compete with yield-bearing assets when rates rise.
The precious metal was also held down by a stronger dollar. Gold falls as the dollar rises, as it is denominated in the U.S. currency and is sensitive to moves in the dollar.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, rallied 0.06% to 94.39.
Bullion becomes more expensive for holders of other currencies when the dollar rises and cheaper when it falls.
Trade tensions resurfaced on Wednesday, after new reports said the White House plans to propose tariffs of 25% instead of 10% on $200 billion of imported Chinese goods. Uncertainty over proposed tariffs eased on Tuesday, after a Bloomberg article said the U.S. and China are seeking to resume trade talks.
Other metals were lower on the Comex, with Silver futures falling 0.60% to $15.465 a troy ounce. Among other precious metals, Platinum Futures slumped 3.04% to $820.00, while Palladium Futures decreased 1.48% to $915.30 an ounce. Copper futures fell 2.88% to $2.750 a pound.