PRECIOUS-Gold rises as markets brace for Fed guidance on easing path

By Arunima Kumar and Pablo Sinha

Dec 9 (Reuters) - Gold rose on Tuesday as investors positioned for an expected December Federal Reserve rate cut and looked for signs of whether policymakers will outline a slower easing path when their two-day meeting begins later in the day.

Spot gold XAU= rose 0.36% to $4,203.65 per ounce by 1130 GMT. U.S. gold futures GCcv1 for February delivery rose 0.4% to $4232.9 per ounce.

"With ongoing geopolitical turbulence enhancing the safe-haven appeal of the precious metal, and a dovish outlook for a Federal Reserve that remains under political pressure to lower borrowing costs, the path of least resistance for gold remains to the upside," said ActivTrades analyst Ricardo Evangelista.

Gold prices could revisit the $4,300 level in the near future should the Fed confirm dovish expectations, added Evangelista.

Markets now assign an 89.4% chance of a 25-basis-point rate cut when its policy meeting concludes on Wednesday, according to CME's FedWatch Tool, but the focus will be on any signals about the path ahead. FEDWATCH

Lower interest rates tend to favour non-yielding assets such as gold.

Last week, data showed the U.S. Personal Consumption Expenditures Price Index, the Fed's preferred inflation gauge, landed in line with expectations, while consumer sentiment improved in December.

Private payrolls for November recorded their sharpest drop in more than 2-1/2 years, but jobless claims fell to a three-year low for the week ended November 28.

Meanwhile, silver XAG= rose 0.74% to $58.56 per ounce.

The white metal hit a record high of $59.32 on Friday, with analysts citing tight physical supply and depleted inventories as the main drivers of the rally, aided by supportive macro conditions and expectations of Fed rate cuts.

"Into year-end, silver prices could consolidate in a broad $55 to $60 range depending on how monetary policy expectations evolve," said Dat Tong, senior financial markets strategist at Exness.

Platinum XPT= gained 0.07% to $1,643.43 per ounce, while palladium XPD= rose 0.4% to $1,471.06 per ounce.