By Gina Lee

Investing.com – Gold was down on Wednesday morning in Asia, after as geopolitical concerns over Ukraine decreased risk appetite. Investors also await the U.S. Federal Reserve’s .

After hitting its high point at $1852.65, it was down 0.9% to $1847.10 (11:56 PM ET)

Russia expressed “great concern” after the U.S. put 8,500 troops on alert to be ready to deploy in case of a Russian invasion of Ukraine. It also called on its European allies, to ensure that sanctions are ready for any escalations.

Bob Haberkorn, RJO Futures’ senior market strategist, said that the safe-haven yellow gold is being used as a “flight-to-safety trade” during a wait-and watch scenario up to and after Fed announcement.

This announcement will be closely examined for clues as to how aggressive the Fed is for the remainder of 2022, and if the Fed intends to signal higher interest rate increases in an effort tackle inflation.

It is expected that the Fed will raise interest rates in March 2022. Then, three additional hikes are planned throughout 2019.

The Fed is likely to make an announcement this week about the U.S. rate increase cycle. However, gold has been holding steady. Giovanni Staunovo from UBS said to Reuters that support for the yellow metal stems from elevated market volatility and high inflation.”

Staunovo stated that gold “could stay supported” if the Fed does not surprise with a more hawkish announcement. Historically, gold has outperformed equities as market volatility rises.

Later in the day, the will also hand down its policy decision. The next step is the Thursday. The Asia Pacific will receive its policy decision within the week.

Silver fell 0.1% in other precious metals while platinum rose 0.1% and palladium rose 2.3%.