Bareksa.com - Gold edged lower on Wednesday as investors nervously awaited a policy statement by the U.S. Federal Reserve and fresh economic data, with political tensions in Ukraine failing to prompt heavy safe-haven bids.

The Fed will make a statement later on Wednesday at the end of its two-day policy meeting, with markets watching for the U.S. central bank's stance on tighter monetary policy. Data on private sector hiring and GDP growth is also expected.

Spot gold fell 0.2 percent to $1,293.10 an ounce by 0635 GMT, after closing flat in the previous session.

"The combination of the FOMC and the economic releases occurring on the same day may cause gold volatility to pick-up in the near-term and may put to test the recent tight $30 price range of between $1,280-1,310," HSBC analysts said in a note.

Fed policymakers are set to continue paring their massive bond-buying stimulus, and may also address issues such as the timing of a rate hike, although no major changes are expected.

GDP data could show that a brutally cold winter likely put a brake on the U.S. economy in the first quarter, but data since the beginning of the second quarter has been positive. Payrolls report will be released. An improving economy and slowing stimulus measures hurt gold's appeal as an investment compared with other assets.

Meanwhile, hundreds of pro-Moscow separatists stormed government buildings in one of Ukraine's provincial capitals on Tuesday and fired on police holed up in a regional headquarters, a major escalation of their revolt despite new Western sanctions on Russia.

Geopolitical tensions usually increase gold's appeal as a safe-haven asset. Gold has gained from rising Ukraine tensions this year, but it has recently been weighed down by strong economic data.

In a bid to rein in wild volatility that has spooked investors in recent years, U.S. futures exchange CME Group Inc is considering the introduction of daily limits on price
moves in gold and silver futures, a CME official said on Tuesday.

Deutsche Bank has resigned its seat on the London precious metal fixes without finding a buyer, leaving four banks to set the global gold price benchmark under increasing
regulatory scrutiny.

PRICES AT 0635 GMT
Metal Last Change Pct chg

Spot gold 1293.1 -2.88 -0.22
Spot silver 19.34 -0.13 -0.67
Spot platinum 1417.6 -7.7 -0.54
Spot palladium 797.6 -4.9 -0.61
Comex gold 1293.2 -3.1 -0.24
Comex silver 19.33 -0.158 -0.81
Euro 1.3805
DXY 79.809

COMEX gold and silver contracts show the most active months (Source : Reuters)