Gold steadies as focus turns to U.S. Fed minutes

Gold prices were little changed on Wednesday as investors held off on big bets ahead of minutes from the U.S. Federal Reserve's latest policy meeting that could offer more cues on its rate-hike path.

Spot gold was steady at $1,833.30 per ounce, as of 1053 GMT. U.S. gold futures were flat at $1,842.50.

"The market focus is on the Fed minutes which will be released later today but if there's concerns about higher inflation or more persisting inflation scenarios then we could see gold prices potentially facing some headwinds," Bank of China International analyst Xiao Fu said.

Minutes of the Fed's latest meeting are due at 1900 GMT on Wednesday. The Fed raised rates by 25 basis points at its Jan. 31-Feb. 1 meeting, and is expected to raise benchmark rates above 5% by May with a peak seen at 5.347% in July.

Gold is highly sensitive to rising U.S. interest rates, as these increase the opportunity cost of holding non-yielding bullion.

However, considering central bank activity in the second half of last year, "if ... gold prices go below $1,800 mark in the coming weeks, some central bank purchases could emerge (and are) likely to offset substantial weaknesses", Fu added.

Meanwhile, U.S. business activity unexpectedly rebounded in February, reaching its highest level in eight months, according to a survey on Tuesday.

Recent strong U.S. economic readings have raised bets for more rate hikes from the Fed, pressuring gold prices which have fallen 4.9% so far this month.

Gold may retest a support of $1,830 per ounce, a break below which could open the way to $1,816, according to Reuters technical analyst Wang Tao.

Among other precious metals, spot silver edged 0.1% lower to $21.81 per ounce and platinum gained 0.2% to $944.40.

Palladium shed 1.8% to $1,498.09 per ounce.