Gold holds above $4,000 after Fed rate cut

Gold prices rose modestly in the run-up to the U.S. Federal Reserve's policy decision this week, then settled into a range above the key 4,000 dollar mark as markets digested the Fed's 25 basis point cut and remarks from Chair Jerome Powell. Traders cited bargain hunting after a recent dip, ongoing central bank buying and shifting expectations about future rate moves as the main drivers of bullion's recent volatility.

On Wednesday, spot gold climbed about 0.7 percent to roughly $3,977 an ounce as investors positioned ahead of the Fed meeting. Earlier this month the metal hit an all-time high of $4,381.21 and has risen about 52 percent year to date. By the end of the week, gold was trading near $4,030 as markets moved past the policy decision and refocused on earnings, geopolitical developments and incoming economic data.

The Fed cut its benchmark rate by 25 basis points and signaled the end of quantitative tightening. Powell, in post-meeting comments, cautioned that a December reduction is not a foregone conclusion and stressed that future policy will remain data dependent. That tone reduced some of the immediate momentum for further rate cuts and helped push the U.S. dollar and...