Bullion traders are awaiting the conclusion of a two-day US Federal Open Market Committee (FOMC) meeting, with the Central Bank widely expected to hike rates. Although monetary policy tightening like rate hikes typically act as a headwind for precious metals prices, the last few decisions have seen the US dollar subsequently fall, potentially boosting prices of gold.
The yellow metal also received added momentum after US Attorney General Jeff Sessions faced questions from a Senate panel about his dealings with Russian officials and whether he deliberately misled Congress. The panel is investigating alleged Russian interference in the 2016 presidential polls. With gold displaying strength ahead of the Fed interest rate announcement, analysts reckon that a convincing break above strong resistance at $1275 per ounce could unlock further upside in prices.