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Gold prices opened weak in Indian market tracking the global cues even as the Fed meet was underway.
On Wednesday, MCX Gold futures for August expiry dropped by a quarter per cent or Rs 95 at Rs 34,434 per 10 grams in the opening trades against the previous close of Rs 34,529 on Tuesday. The prices, however, came down from record high of Rs 35,409 earlier this month in futures.
In the spot market fine gold (999 purity) slightly came down to Rs 34,946 per 10 grams (excluding 3 per cent GST) as quoted by India Bullion and Jewellers Association Ltd (IBJA), down from Rs 35,010 on Tuesday.
The weakness in gold market is attributed to the downward trend in the global markets.
COMEX August gold futures was down $0.8 at USD 1,428.9 an ounce in late night trades on Tuesday.
The two-day crucial meeting of the US Federal Reserve's Open Market Committee (FOMC) is underway amid expectations of a lowering of interest rates - likely be the first time since 2008 financial crisis.
The current target range for the Fed fund rates is 2.25 per cent to 2.5 per cent.
The Fed chairman Jerome Powell is scheduled to make a media address on July 31, 2.30 pm US Time (approx 3 am IST on Thursday) after the meet.
A possible rate cut will fuel the liquidity into the system pushing investment demand for the precious metal.
In its morning report, brokerage house Kedia Commodities gave a trading range for gold at Rs 34,049 - Rs 35,013 for Wednesday.
"Gold dropped as prices seen under long liquidation ahead of expiry and as investors awaited the outcome of a two-day U.S. Federal Reserve policy meeting," the report stated.
In the past four days, international gold prices have gained by about USD 15 an ounce from USD 1414.10 on July 25 to USD 1430.56 on July 30 indicating towards a possible monetary easing by Fed.
MCX silver futures for September contract quoted at Rs 41,417 per kg, down RS 153 or 0.3 per cent. Spot silver gained to Rs 41,000 per kg as reported by IBJA.
COMEX Silver August futures quoted marginally negative at US $ 16.46 per oz.
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