Gold prices edged higher on Wednesday (July 30th), boosted by a slightly weaker dollar as investors awaited the Federal Reserve's policy decision and comments that could provide further clues about the timing of the US central bank's next move.

Spot gold rose 0.2% to $3,331.03 an ounce, as of 08:28 GMT. US gold futures rose 0.1% to $3,328.30. The dollar index, weakened 0.1% after hitting a more than one-month high on Tuesday, making gold cheaper for holders of other currencies.

"There are a variety of factors that, combined, are keeping gold prices subdued. From a geopolitical perspective, we appear to be making progress on tariff negotiations, but no one is really ready to commit yet," said StoneX analyst Rhona O'Connell.

Negotiations between China and the US will be in the spotlight after officials agreed to extend their 90-day tariff truce, following two days of talks described by both sides as constructive in Stockholm.

Trade agreements with Japan last week and the European Union over the weekend eased investor concerns and lifted risk sentiment in the market this week.

Meanwhile, the Fed is expected to keep interest rates unchanged on Wednesday, despite US President Donald Trump's continued calls for a rate cut. Markets will be watching Fed Chairman Jerome Powell's remarks for more clues on the direction of interest rates.

"The market is pricing in two rate cuts before the end of the year, which may be too soft. The Fed won't give in to political pressure, but it will be interesting to see whether today's vote is unanimous," O'Connell said.

Gold tends to perform well in a low interest rate environment. Elsewhere, spot silver fell 0.4% to $38.04 an ounce, platinum fell 1% to $1,381.69, and palladium fell 0.5% to $1,252.40.(alg)

Source: Reuters