WASHINGTON (dpa-AFX) - Gold prices dipped in cautious trade on Tuesday as investors keep an eye on geopolitical tensions and await the outcome of a Federal Reserve meeting for clues on its interest rate hikes.
Spot gold dropped 0.3 percent to $1,838.52 per ounce, while U.S. gold futures were down 0.2 percent at $1,838.55.
The dollar edged higher to hover near a two-week high amid lingering tensions between the U.S. and Russia over Ukraine.
After NATO said it was putting forces on standby and reinforcing Eastern Europe with more ships and fighter jets, Russia accused the West of 'hysteria' and putting out information 'laced with lies.'
The U.S. military put about 8,500 troops on alert to be ready to deploy to Europe if needed.
Concerns about tightening monetary policy continue to weigh as the Fed begins a two-day policy meeting later today, with the latest monetary policy decision due Wednesday afternoon.
The accompanying statement could hint at the first rate hike as early as the next meeting in mid-March.
Fed funds futures, which track short term rate expectations, have priced in a total of four rate increases this year.
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