Gold inches up before Fed decision as traders bet on a December rate hike

what happened

Gold rose slightly on Wednesday, according to Reuters, after gaining about 1% in the previous session. Investors are waiting for the Federal Reserve's policy announcement, due at 1800 GMT, and most expect the central bank to keep rates on hold.

Spot gold was up 0.1% at $4,061.86 an ounce by 0036 GMT, following a Tuesday session high of $4,065.55. December US gold futures held near $4,075.60. CME FedWatch data put the odds of a December rate increase at roughly 84%. Spot silver added 0.1% to $54.38 an ounce, platinum dipped 0.2% to $1,537.58 and palladium climbed 0.5% to $1,031.42.

Reuters also reported that Iran-aligned Houthis in Yemen said they struck Saudi Arabia's Ras Tanura refinery, the kingdom's largest, with a ballistic missile.

why it matters

Gold pays no interest, so higher rate expectations raise the cost of holding it. A hawkish Fed signal usually weighs on the metal, while persistent inflation and higher energy costs support demand for it as a hedge. Reuters' analyst survey cut platinum and palladium forecasts for a third straight quarter, though a rebound is still expected in 2027.

market impact

Gold and silver: expected December Fed hike puts pressure on precious metals

• ▼Gold pressure down — higher rate expectations raise the opportunity cost of holding non-yielding bullion

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