Gold retained losses from overnight on Thursday, as the Federal Reserve characterized the recent slowdown in the U.S. economy as only transitory, not ruling out an interest rate hike this year.
The Fed downgraded its view of the U.S. labor market and economy after its two-day policy meet and said the poor performance was in part due to transitory factors.
The Fed's guidance differed little from its last meeting, but this time the central bank did not effectively rule out hiking rates at its next meeting.
Gold had hit a three-week high this week in the run up to the statement on expectations that recent soft economic data would prompt the Fed to delay any rate hike.
Investors believe higher rates could dent demand for bullion, a non-interest-paying asset.
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