Investing.com - Gold prices were hovering near the $1,500 level on Wednesday as investors awaited the outcome of the Federal Reserve meeting later in the day, where the central bank is expected to deliver a rate cut.
By 08:08 AM ET gold futures for delivery on the Comex exchange were down 0.2% at $1,509.55 a troy ounce. Spot gold was little changed at $1,502.14 an ounce.
Prices were rangebound ahead of the Fed decision while fears over a spike in inflation from oil prices have eased, dampening demand for haven assets.
"Hopes that Saudi Arabia's production is going to come back online and oil prices will start to depreciate have boosted market sentiment, so we continue to see some calm across the markets ahead of the Fed meeting," said FXTM analyst Lukman Otunuga.
Oil prices pulled back, having surged nearly 15% earlier in the week, after Saudi Arabia's energy minister said the country would restore its lost production by month-end, having restored customer supplies to levels they were prior to attacks on its key facilities.
Gold is considered a hedge against oil-led inflation.
"There is something about that $1,500 level and gold is waiting for a catalyst, which will come in the form of the Fed," Otunuga said.
Some strong U.S. economic data has dampened expectations for a rate cut in recent days, but the Fed is still widely expected to lower rates by 25 basis points, with the focus now on how far the U.S. monetary policy easing will go.
It would be its second rate cut in less than two months amid concerns over the fallout from the trade war with China and slowing global growth.
Among other precious metals, silver slid to $17.94 an ounce while platinum was down 0.8% at $935.55 an ounce.
--Reuters contributed to this report