MCX Gold Tips: Gold futures ended on a bearish note in the domestic market on Tuesday tracking weakness in the yellow metal internationally where prices fell to a two-week low as investors stuck to a cautious approach ahead of the much anticipated US Federal Reserve policy decision.

The Fed, on Tuesday kicked off a two-day monetary policy meet, in which the world’s top central bank is likely to offer cues over the path to raising interest rates further following a maiden hike in borrowing costs in almost a decade in December.

While the Fed is likely to keep interest rates unchanged on Wednesday, the tone of its statement will be keenly watched to assess the trajectory of further rate hikes in the world’s biggest economy. An indication by the Fed to delay further tightening of interest rates could boost gold’s appeal as a store of value.

US producer prices fell 0.2 per cent in Feb over Jan, signaling muted inflationary pressures.

Further, the Bank of Japan’s failure to announce additional monetary easing measures also dampened the bullion, a hedge against the inflationary risk of monetary stimulus.

The apex bank which surprised markets in January by adopting negative interest rates, kept unchanged the target for boosting the monetary base annually at 80 trillion yen while maintaining its benchmark rate at -0.1 per cent but indicated its willingness to bolster monetary easing, if needed.

Gold may continue to trade on a cautious note today ahead of Fed policy verdict.

At the MCX, Gold futures for April 2016 contract closed at Rs 29,037 per 10 gram, down by 0.51 per cent after opening at Rs 29,125, against the previous closing price of Rs 29,187. It touched the intra-day low of Rs 28,872.