By Noreen Burke
Investing.com -- Gold prices edged lower on Wednesday a day after posting their largest one-day percentage gain since June 2016 in the wake of the Federal Reserve’s dramatic rate cut, a measure aimed at calming fears over the economic impact of the coronavirus outbreak.
By 09:07 AM ET (1407 GMT), gold futures for delivery on the Comex exchange were trading at $1,642.00 a troy ounce, little changed for the day. Spot gold was at $1,641.40.
Gold rallied as much as 3.7% on Tuesday after the Fed cut rates by 50 basis points in an emergency move, citing the “evolving risks” of the coronavirus to the U.S. economy.
The last time the Fed made a rate cut between scheduled meetings was in October 2008 at the height of the global financial crisis.
The U.S. central bank acknowledging scale of the challenge and the limits of monetary policy to deal with a public health crisis but said the cut could provide a “meaningful boost” to the economy.
"The market is probably waiting for additional potential announcements from other central banks ... the stock market has recovered a little bit, and that's (leading to) some profit taking in gold," said Saxo Bank analyst Ole Hansen.
"Cutting rates was probably a wrong decision because it also leaves the Fed with even less ammunition for future cuts ... the market is based on the assumption that it's a small plaster on the big wound and it's not going to help in the short term."
The Bank of Canada is expected to follow the Fed's example at its policy meeting later Wednesday.
Silver futures were little changed at $17.15 an ounce while platinum futures rose 0.9% to $877.35. Copper futures were up 0.5% to $2.58 a pound.
--Reuters contributed to this report