PRECIOUS-Gold rises as focus turns to Fed policy decision
(Adds analyst comment, updates prices)
* U.S Fed policy statement due at 1900 GMT
* Economic recovery hopes to keep platinum supported -analyst
* Interactive graphic tracking global spread of coronavirus: open
* https://tmsnrt.rs/3aIRuz7 in an external browser
By Asha Sistla
Dec 16 (Reuters) - Gold rose to a one-week high on Wednesday on market hopes for further fiscal support for the U.S. economy and expectations that the U.S. Federal Reserve will keep a lid on interest rates.
Spot gold XAU= was up 0.2% at $1,857.21 an ounce by 1307 GMT after touching its highest since Dec. 9 at $1,865.50. U.S. gold futures GCv1 rose 0.3% to $1,861.
"If we get a Brexit deal over the line, a stimulus deal in the U.S. and the monetary stimulus package from the Fed this week, which is extremely possible, that could put gold on a more positive trajectory and take some volatility out of the markets going into year-end," said OANDA analyst Craig Erlam.
U.S. congressional leaders were optimistic on Tuesday about ending a months-long standoff on a coronavirus stimulus package. on investors' radar is the Fed's policy statement at 1900 GMT. The central bank is widely expected to keep interest rates pinned near zero. benefits from its appeal as a hedge against inflation that could result from the unprecedented stimulus unleashed in 2020.
"But if (the Fed) fails to deliver, we could be seeing gold moving back towards November lows," OANDA's Erlam said.
Capping bullion's gains, European shares hit a 10-month peak on hopes of vaccine rollouts across the world. .EU
In other precious metals, silver XAG= gained 2.3% to $25.04 an ounce, platinum XPT= was up 0.4% to $1,040.24 after hitting a more than one-week high of $1,050.50 while palladium XPD= rose 0.4% to $2,326.99.
"Unless the current wave of infections derails the global economy, recovering industrial production may further boost silver and the PGMs (platinum group metals)," HSBC analyst James Steel said in a note.
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