Gold prices fell below the psychological level of $1500 an ounce during Tuesday’s trading session, as investors tended to acquire risky assets after rising optimism regarding US-China trading conditions.
As of 08:03 GMT, spot gold hovered around $1,496.15 an ounce, where the precious metal hit the highest level today at $1,496.85 while the lowest level was recorded at $1496.05.
The precious metal came under pressure as U.S. stocks surged overnight, where the Standard & Poor's 500 index climbed to a record high, supported by strong business results and optimism that the world’s biggest economies are heading closer to a trade deal.
U.S President Donald Trump has said that the first phase of the trade deal with China is likely to be signed before the mid-month deadline.
"We are looking probably to be ahead of schedule to sign a very big portion of the China deal, we'll call it Phase One but it's a very big portion," Trump said.
In Asia, Japan’s Nikkei 225 index closed 0.47 percent up at 22,974.13, noting that the index reached 23,008 points in the session, the highest level since October 11, 2018. China’s CSI 300 index slumped 0.42 percent to finish at 3,910.23.
In Britain, FTSE 100 descended 0.36 percent to 7,304.80, as the British parliament has rejected Prime Minister Boris Johnson's proposal to call for an early general elections.
The U.S dollar index, which measures the currency's performance against six major currencies, was up 0.11 percent at 97.63.
Later in the day, the Federal Reserve will start a two-day policy meeting, where lawmakers may slash the borrowing cost to 1.75 percent from the current 2.00 percent.
In general, an interest rate cut by the Fed should uplift gold since bullions provide no interest to their holders.
However, the impact on gold prices may will depend on the markets’
pricing to the rate cut and other key factors, most notably the trade war developments.