Gold closes lower ahead of Fed's rate decision

Gold prices fell on Tuesday, while the US dollar held against most of its peers on Tuesday, ahead of the Federal Reserve's interest rate decision.

The US producer price index rose 0.8% in May, beating forecasts of a rise by 0.5%, and the core reading rose by 0.7%, higher than forecasts of 0.5%.

The US retail sales index fell 1.3% in May, worse than forecasts of drop by 0.6%, and the core reading fell 0.7%, missing forecasts of a rise by 0.4%.

The Fed is convening later today to decide on monetary policy and provide clarity over the future of monetary policy in the US, amid expectations to keep the interest rate between 0.0% and 0.25% unchanged. 

The dollar index rose against a basket of major currencies by less than 0.1% to 90.5 points as of 18:46 GMT, after hitting a high of 90.6 points and a low of 90.3 points.

Gold August futures fell 0.5% or $9.50, and closed at $1,856.40 an ounce.