GOLD prices fell on Wednesday to their lowest level in nearly four weeks as investors looked towards a U.S. Federal Reserve policy decision that could offer for more cues on its rate-cut timeline.

Spot gold was down 0.1% at $2,284.44 per ounce as of 0436 GMT, after hitting its lowest level since April 5 earlier in the session. Prices fell as much as 2% on Tuesday due to an uptick in the dollar and U.S. Treasury yields.

Bullion prices have fallen more than $140 after scaling a record high of $2,431.29 on April 12.

U.S. gold futures were down 0.4% at $2,293.10 per ounce.

"Inflation readings have shown no progress at all so far in 2024, the Fed will have to backtrack and pivot more towards a more hawkish message and the gold market is discounting that," said Marex analyst Edward Meir.

Focus is now on the U.S. central bank's policy decision due at 1800 GMT followed by remarks from Chair Jerome Powell. The Fed is expected to hold its benchmark interest rate steady at 5.25% to 5.5%.

"If Powell strikes a hawkish tone, prices could fall $30 or $40 more between today and the next day," Meir said.

Gold is known as an inflation hedge but elevated interest rates reduce the appeal of holding the non-yielding asset.

Data on Tuesday showed that U.S. labour costs increased more than expected in the first quarter, confirming the surge in inflation early in the year that will likely delay a rate cut later this year.

China's financial markets are closed from May 1 to 5 for the Labour Day holiday.

Among other metals, spot silver rose 0.3% to $26.37 per ounce and platinum inched up 0.2% to $935.80. Palladium lost 0.2% to $945.53, having hit its lowest in nearly two months in the previous session.

 - Reuters