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Gold and silver prices edged higher in Indian markets today but the gains were muted amid flat global rates. On MCX, February gold futures were up 0.1% to one-month high of 48,613 per 10 gram while silver rose 0.17% to 64,069 per kg. In global markets, gold was steady fuelled by escalating Ukraine tensions but concerns about a faster pace of US Federal Reserve policy tightening capped gains. Spot gold was little changed at $1,840.24 per ounce while silver fell 0.8% to $23.77 an ounce. 

While gold stays above $1830 expect upticks to continue while a break below $1780 is a weak signal, domestic brokerage Geojit said. 

For silver, expect “choppy with with negative bias but a direct break of $23.50 would trigger further liquidation pressure. A close above $25 is a signal of bullish outlook," the brokerage added. 

Gold traders will be focusing on Fed's two-day policy meeting starting later in the day. The US central bank is widely expected to raise rates by 25 basis points in March. Though gold is seen as an inflationary hedge, but it is highly sensitive to rising US interest rates, which increase the opportunity cost of holding non-interest bearing bullion.

Meanwhile, holdings of the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, rose to their highest since late August 2021 last Friday, amid Ukraine-Russia geopolitical tensions. 

As Russian troops mass on the border with Ukraine NATO, said on Monday it was putting forces on standby and reinforcing eastern Europe with more ships and fighter jets.

“Gold in considered inflation hedge and risen as rise in crude oil price and inflation data from Europe and Japan rekindled inflation concerns. Gold is also considered a safe haven asset and rose last week as geopolitical tensions continued to rise. Russia’s amassing of troops along Ukraine border has fueled concerns of an in invasion," Kotak Securities said in a note. 

Analysts expect gold prices to remain volatile in the near term amid Fed meeting and Russia-Ukraine concerns. (With Agency Inputs)

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