Spot gold was down 0.7% at $3,301.82 per ounce. U.S. gold futures fell 0.9% to $3,352.3.
The U.S. central bank left rates unchanged on Wednesday, resisting pressure from U.S. President Donald Trump’s repeated calls for cuts. The federal funds rate will continue to be set in a range between 4.25% to 4.5%.
At a news conference on Wednesday afternoon, Federal Reserve Chair Jerome Powell said that no decision has been made for September and that the central bank must wait and see the impact of tariffs before acting.
Nitesh Shah, commodities strategist at WisdomTree, noted that the louder the administration voices its distaste for current policymaking, the more likely it is to drive gold prices.
Gold tends to do well in a low-interest rate environment and during periods of uncertainty.
The ADP National Employment report showed U.S. private payrolls rising more than expected in July, though signs of a slowing labor market persisted. Separately, a Commerce Department report showed second-quarter GDP grew 3%, beating forecasts of 2.4% in a Reuters poll.
“The releases that just came out really look quite supportive for the economy. GDP was an upside surprise. Same with labor market addition. So both indicate that the Fed can continue to wait on cutting rates,” Shah said.
On the trade front, U.S. and China agreed to extend their 90-day tariff truce following two days of what were described as constructive talks in Stockholm.
Elsewhere, spot silver fell 1.6% to $37.59 per ounce, platinum slipped 3.3% to $1,349.15 and palladium was down 2.9% to $1,222.75.