Gold down

London

Gold dipped on Tuesday, losing its lustre ahead of a key two-day meeting of the U.S. Federal Reserve that is expected to deliver the second interest rate rise in a decade.

The Fed meeting starts later on Tuesday and markets have priced in a nearly 100 percent chance of a quarter percentage point increase.

Higher rates could dent demand for non-interest paying gold, while also boosting the dollar. Spot gold was down 0.2 percent to $1,160.35 an ounce at 1237 GMT, after briefly touching a 10-month low on Monday.

U.S. gold futures were down $3.90 at $1,161.90. "The market is looking for future guidance because at this stage a rate hike should be a given," said Saxo Bank´s head of commodity strategy, Ole Hansen.

Investors will be looking for clues on how the central bank will deal with inflation that could possibly emanate from the policies of U.S. President-elect Donald Trump and growth expectations.