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Spot gold was last up 0.1% at $1,945.56 per ounce by 1026 GMT.
U.S. gold futures rose 0.3% at $1,943.10.
"Gold's upside is severely capped by the Fed's aggressive bias
towards rate hikes, though the precious metal remains
well-supported by persistent fears over the Russia-Ukraine war’s
global implications," said Han Tan, chief market analyst at
Exinity.
Gold is highly sensitive to rising interest rates, which raise
the opportunity cost of holding bullion.
Last week, the U.S central bank raised borrowing costs by 25
basis points, disappointing sections of the market that had
priced in a larger move. Top Fed policymakers have since batted
for a more aggressive approach to monetary policy tightening
this year to bring down soaring inflation.
That has propped up the dollar and yields on the U.S. 10-year
Treasury note, pressuring greenback-priced, zero-yield gold.
[USD/] [US/]
With bullion-backed exchange-traded funds elevated, "gold could
well attract more suitors who hold to the precious metal as a
safe haven and an inflation-hedge, especially if stagflation
risks become more amplified over the near term," Tan said. [GOL/ETF]
Meanwhile, Britain and its western allies will examine whether
more can be done to prevent President Vladimir Putin from
accessing Russia's gold reserves, Prime Minister Boris Johnson
said.
Russian central bank reserves are probably not actively traded,
said Bernard Dahdah, an analyst at Natixis.
However, in theory, a move like that would withdraw some gold
from the market, likely reducing liquidity and potentially
helping gold prices, Dahdah said.
Spot silver was steady at $25.07 per ounce, platinum fell 0.8%
to $1,012.49, and palladium dipped 0.3% to $2,504.70.
(Reporting by Bharat Govind Gautam in Bengaluru; Editing by
Aditya Soni)
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