Gold prices rose more than 1 per cent on Thursday, helped by a retreat in the US dollar, while the Federal Reserve cut interest rates by a quarter of a percentage point as widely expected, reports Reuters.
Spot gold was up 1.2 per cent at $2,691.36 per ounce as of 2:22 p.m. EST (1919 GMT), after dropping to a three-week low on Wednesday. US gold futures settled 1.1 per cent higher at $2,705.80.
At the end of a two-day policy meeting, the US central bank lowered the benchmark overnight interest rate to the 4.50 per cent-4.75 per cent range, with policymakers taking note of a job market that has "generally eased".
Lower US interest rates put pressure on the dollar and bond yields, increasing the appeal of non-yielding bullion.
"Gold remains in a strong bull market and no event this week, from the election to today's Fed decision, is likely to change that," said Tai Wong, an independent metals trader.
"Unless Powell leans towards a pause today, gold is likely to take back yesterday's knee-jerk losses," Wong added.
The dollar index was down 0.6 per cent against its rivals after rising to a four-month high after Republican former President Donald Trump's win in Tuesday's presidential election. [USD/]
Traders are currently pricing in another 25 basis point cut by the Fed in December, according to LSEG data.
Investors now look forward to comments from Fed Chair Jerome Powell's press conference due at 2:30 p.m. ET for more cues on monetary policy path.
Elsewhere, spot silver rose 1.8 per cent to $31.71 per ounce, platinum gained 0.6 per cent to $992.65 and palladium shed 1.3% to $1,021.25.
