Yesterday the gold price once again fell below the psychological $1,200 barrier as volatility returned to the market. Trader’s attention will now shifted to the Fed’s Open Market Committee meeting later today.

The markets are also closely watching the currency markets after the Russian Rouble crashed 11% against the U.S dollar on Tuesday despite the Russian Central Bank hiking interest rates from 10.5% to 17%. This year the rouble has fallen over 50% against the U.S. dollar stirring memories of the 1998 crises when the rouble collapsed in a matter of weeks. Russia eventually defaulted on its sovereign debt which caused the bankruptcy of the hedge fund Long Term Capital Management.

Gold traders will be looking to the Federal Open Market Committee for an indication on the future direction of interest rates. Rising interest rates normally put downward pressure on the gold price.

Gold is currently trading at £761.77 per ounce, silver £10.09 per ounce, platinum £765.96 per ounce and palladium £501.02 per ounce.