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Spot gold was down 1.2% at $1,928.58 per ounce, as of 1032 GMT,
after earlier touching its lowest since March 3 at $1,924.56.
U.S. gold futures fell 1.5% to $1,930.70.
"Some faint hopes that talks between Ukraine and Russia may
somehow lead to a de-escalation has affected safe-haven demand
for gold," ActivTrades senior analyst Ricardo Evangelista said.
While gold is seeing a bit of a lull, the Ukraine situation is
still unfolding, with market volatility and uncertainty likely
to remain quite high, Evangelista added.
Gold prices are set to fall for a third straight session, which
could be their longest losing streak since late January.
The Fed is expected to raise borrowing costs by a quarter of a
percentage point at the end of its two-day meeting on Wednesday.
The impending announcement has kept U.S. 10-year treasury yields
elevated and put pressure on gold since rising U.S. interest
rates increase the opportunity cost of holding non-yielding
bullion. [US/]
"The first rate hike move from the U.S. quite often signals a
low point in gold, so we'll see what kind of signal they send
tomorrow, and how hawkish their statement is, which will
probably determine the short-term outlook from here," said Saxo
Bank analyst Ole Hansen.
Meanwhile, spot palladium was up 1.7% at $2,428.72 per ounce,
after its weakest session in two years on Monday on easing
supply fears.
Palladium is a notoriously low-liquidity market, Hansen said,
and with the war premium being taken out of commodity markets,
palladium has not been shielded. [O/R]
Spot silver shed 1.8% to $24.58 per ounce, while platinum
slipped 1.8% to $1,012.04.
(Reporting by Bharat Govind Gautam in Bengaluru. Editing by Jane
Merriman)
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