Its intensifying spread and an escalation in U.S.-China tensions have dented hopes of quick economic recovery, and have been driving inflows to safe-haven assets like gold, which has risen more than 28% so far this year.
The Fed will publish its interest rate decision at 1800 GMT, widely expected to keep rates unchanged, following which Chair Jerome Powell is scheduled to hold a press conference.
"I expect the Fed to maintain its uber-dovish tone and this will support precious metals prices," said Jeffrey Halley, a senior market analyst at OANDA.
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Gold tends to gain when interest rates are low, which reduces the opportunity cost of holding non-yielding bullion.
It's also considered a hedge against inflation and currency debasement as central bank pump out stimulus. Republicans in the White House and the U.S. Congress struggled to reach a deal over a $1 trillion aid plan.
Elsewhere, silver dropped 1.7% to $24.16 per ounce, platinum fell 1.3% to $936.09 and palladium slipped 0.6% to $2,269.22.
