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·         Gold prices retreated from a one-month high on Tuesday as equities gained and the markets awaited clues about monetary policy from the U.S. Federal Reserve, which began its two-day meeting.

The market is not expecting an interest rate increase following the Fed's two-day meeting, but it is looking for hints on the timing and extent of future moves.            

·         Spot gold was down 0.2 percent at $1,251.90 an ounce by 1:50 p.m. EDT (1750 GMT), not far from the previous session's peak of $1,258.79, its highest since June 23. While U.S. gold futures settled down 0.2 percent at $1,252.10.

·         "The market is looking for clarity on the Fed's tightening cycle and when they are going to start with the tapering (of monetary stimulus)," said ETF Securities analyst Martin Arnold.

·         Taking the shine off gold slightly, investors climbed into European and U.S. equities after a string of solid corporate reports.           

·         Markets give a 48 percent probability of a U.S. interest rate increase before the end of the year, according to CME's Fedwatch tool.            

·         U.S. single-family home prices accelerated at a slower pace in April, falling short of forecasts, while the S&P CoreLogic Case-Shiller composite index of 20 metropolitan areas rose 5.7 percent in May on a year-over-year basis.            

·         "Today's Housing Price Index and S&P/Case-Shiller Home Price Indices came in lower than expectations. This indicates no inflation, which the Fed is eyeing," said Miguel Perez-Santalla, vice president of Heraeus Metal Management in New York.

"If there is no inflation, the Fed is likely to stay its hand at raising too soon, raising doubts."

·         Hurdles standing in the way of U.S. President Donald Trump's economic stimulus and tax reform agenda provided some support to bullion, keeping in near the prior session's one-month top.

·         "There is a dual-pronged attraction to gold at the moment, with low interest rates and investors looking at the metal as a hedge against U.S. political uncertainty," Arnold said.

·         Gold is often seen as an alternative investment during times of political and financial uncertainty.

·         In other precious metals, silver rose 0.6 percent to $16.54 an ounce after hitting its highest since July 3 at $16.64, holding just below the 50-day moving average at $16.65.

Reference: Reuters