FUNDAMENTALS
* Spot gold was up 0.2% at $1,942.96 per ounce, as of
0036 GMT. U.S. gold futures firmed 0.3% to $1,946.20.
* Gold prices dropped about 2% on Tuesday, as easing worries
over a banking crisis prompted some investors to cautiously
return to riskier assets.
* Investors now keenly await the Fed's rate decision due
later in the day, with a 25-basis-point (bps) rate hike
expected, according to the CME FedWatch tool.
* Gold is traditionally considered a hedge against
inflation, but higher rates increase the opportunity cost of
holding the non-yielding asset.
* The dollar index was down slightly, making bullion
less expensive for buyers holding other currencies.
* Markets will also take stock of the February UK inflation
data, also due on Wednesday ahead of the Bank of England's
monetary policy decision on Thursday.
* U.S. Treasury Secretary Janet Yellen told bankers on
Tuesday that she is prepared to intervene to protect depositors
in smaller U.S. banks suffering deposit runs that threaten more
contagion amid the worst financial system turmoil in more than a
decade.
* SPDR Gold Trust , the world's largest gold-backed
exchange-traded fund, said its holdings fell 0.16% to 923.11
tonnes on Tuesday from 924.55 tonnes on Monday.
* Spot silver rose 0.3% to $22.43 per ounce, platinum was 0.4% higher at $972.53 and palladium gained 1%
to $1,401.54.
DATA/EVENTS (GMT)
0700 UK Core CPI YY Feb
0700 UK CPI YY Feb
1800 US U.S. Federal Open Market Committee announces
its decision on interest rates followed by statement
(Reporting by Kavya Guduru in Bengaluru; Editing by Rashmi
Aich)
