Gold prices decreased during Asian trading on Tuesday, staying significantly lower than recent highs due to concerns about prolonged higher interest rates in the United States ahead of a Federal Reserve meeting this week.

- The price of spot gold dropped by 0.4% to $2,326.45 per ounce, while gold futures expiring in June declined by 0.9% to $2,337.30 per ounce. Spot prices were trading more than $100 below the record high reached earlier in April.

- Reduced demand for safe-haven assets also contributed to the decline, particularly as recent reports indicated a renewed ceasefire in the Middle East. This made gold even more susceptible to risks associated with interest rates.

- Despite the recent decrease, gold prices were still up by over 4% for April, continuing the impressive gains observed in March.

- Attention was now focused squarely on the upcoming Fed meeting, where it is widely anticipated that the central bank will maintain current interest rates. However, Fed Chair Jerome Powell is expected to adopt a more hawkish stance on rates, especially following several reports of high inflation.

- Persistent signs of inflation led traders to largely discard expectations of imminent interest rate cuts by the Fed. The central bank is now only expected to consider rate cuts in September or the fourth quarter, if at all this year.

- Prolonged higher interest rates are unfavorable for gold, as they increase the opportunity cost of investing in the precious metal. Furthermore, the strength of the dollar, fueled by expectations of stable rates, also exerted pressure on the broader metal markets.

- On Tuesday, other precious metals also experienced declines, with platinum futures falling by 0.1% to $959.05 per ounce, and silver futures sliding by 1.8% to $27.168 per ounce.

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