Gold lifts as FOMC meeting begins

Sydney-Australia (Sept 16)  Gold prices rose on the European spot market Tuesday, ahead of the start of the US Federal Open Market Committee meeting and the subsequent release of the session's minutes that could cast light on future US monetary policy .

Spot gold was up 0.4 per cent at $US1,236.97 a troy ounce in morning European trade.

"The wording of the FOMC statement this week could still play down future rate hikes and the need for a tighter policy stance into 2015," said Andrey Kryuchenkov, an analyst at VTB Capital.

Such a move would be good for gold, as low interest rates typically keep dollar strength on a leash.

However, the expectation is that the dollar will continue exerting pressure on the precious metal.

"We remain biased to further downside, with the market appearing to be entering a period of sustained dollar strength, which will be a significant headwind for the gold price," said ANZ Research.

The other precious metals in the complex were also buoyed in anticipation of the Fed minutes. Silver was up 0.3 per cent at $US18.695 an ounce, platinum was up 0.2 per cent at $US1,360.25 an ounce, and palladium was up 0.4 per cent at $US834.70 an ounce.