Gold steadies as investors prepare for Fed taper timeline

Gold last traded at $1,771 an ounce. Silver at $21.92 an ounce.

NEWS SUMMARY: Precious metal prices slipped Tuesday ahead of Wednesday's Fed statement. U.S. stocks retreated for a second day as new inflation data continued to show a record rise in wholesale prices.

CNBC--"Gold steadied in a narrow range on Monday as the market focus pivoted to this week's Federal Reserve meeting to learn how quickly it plans to unwind economic support measures introduced in response to the coronavirus pandemic....

'Until we get an idea of how much the Fed accelerates tapering and whether or not they are particularly hawkish in their statement, gold will be under pressure,' said Michael Hewson, chief market analyst at CMC Markets UK.

Gold is considered an inflation hedge, reduced stimulus and interest rate increases tend to push government bond yields up, raising the opportunity cost of bullion.

But with the market pricing in the Fed moving forward into a rate rise cycle, it is sufficient for gold to be counted as a defensive asset right now, said Stephen Innes, managing partner at SPI Asset Management."