09:21 AM EDT, 03/20/2024 (MT Newswires) -- Gold prices fell early on Wednesday as the dollar rose to a month high as the Federal Reserve's policy committee is expected to end its two-day meeting with interest-rates unchanged amid fading hopes for quick rate cuts.

Gold for June delivery was last seen down US$3.20 to US$2,178.00 per ounce.

The drop comes as markets await the afternoon conclusion of the Federal Open Market Committee meeting followed by a press conference with Fed chair Jerome Powell. Optimism the central bank will soon begin lowering rates has faded with inflation remaining above its 2% target but comments from the meeting and Powell will be closely watched for any dovish outlooks.

"Fed announcement is the next big focus, with risks tilted hawkish. A fifth day of dollar strength adding small downward pressure on copper, crude and not least gold given its vulnerability to the FOMC message," Saxo Bank noted.

The dollar was sharply higher ahead of the meeting's end. The ICE dollar index was last seen up 0.66 points to 104.09.

Treasury yields The US two-year note was last seen paying 4.692%, down 0.4 basis points, while the yield on the 10-year note was down 0.9 basis points to 4.289%