Gold traded in a tight $12-range on Wednesday as traders positioned for the U.S. Federal Reserve’s interest rate decision and Chair Jerome Powell’s comments on the path of future hikes.

Spot gold edged up 0.1% to $1,942.57 per ounce by 9:40 a.m. ET (1340 GMT) after dropping 2% on Tuesday. U.S. gold futures were up 0.2% to $1,945.80.

The decision is expected at 2 p.m. ET (1800 GMT), and the Fed is largely expected to increase rates by 25 basis points, according to the CME FedWatch tool, while some Wall Street banks are split over a hike or a pause.

“The market’s interpretation at this point is that a higher terminal rate is going to translate into sooner cuts, and that is really the focus here… gold prices are likely to rise as the probability of Fed cuts increases as opposed to where the terminal rate lies exactly,” said Daniel Ghali, commodity strategist at TD Securities.

Additionally, while the dollar was slightly lower, making gold cheaper for holders of foreign currencies, benchmark Treasury yields were close to their highest in a week.

Gold listless as investors strap in for Fed rate verdict

Gold on Monday breached the key $2,000 level in a rally driven by safe-haven demand after the collapse of U.S.-based Silicon Valley Bank and share-fall at Credit Suisse.

However, prices retreated by around $70 after the rescue of Credit Suisse, with some booking profits.

On the other side of the Atlantic, Euro zone government bond yields rose with ECB hawks calling for more rate hikes. Silver fell 0.1% to $22.35 per ounce, platinum shot up 1.6% to $984.24 and palladium gained 2.7% to $1,426.04.

While strong investment flows into gold have buoyed platinum, palladium rose by virtue of being relatively cheap.

However, Ghali said the amount of oversupply in palladium meant prices would need to rally substantially before they attract investor flows.