Gold rebounded on Tuesday 27 October while oil slipped, as traders weighed hopes of de-escalation in the Gulf against continuing attacks on Saudi Arabia, ahead of the US Federal Reserve's policy decision on Wednesday. Spot gold closed at $4,057.81 an ounce, up 1.03%, its second consecutive daily rise, according to Refinitiv data carried by CNBC Indonesia, and was up a further 0.07% at $4,060.55 in early trading on Wednesday.

US gold futures told a similar story, settling up 0.9% at $4,058.80 an ounce, the Wall Street Journal reported. Oil moved the other way: Brent fell nearly 2% to settle below $114 a barrel and West Texas Intermediate settled just under $100, with Bloomberg putting Brent at $113.96 and WTI at $99.97. US gasoline and diesel futures fell about 3% on the day.

What traders are watching

Peter Grant of Zaner Metals said falling oil prices could support gold by easing inflation concerns and reducing the chance of a hawkish Fed, while Jim Wyckoff of the American Gold Exchange warned that a sustained oil rise could revive inflation pressure and weigh on gold. The Fed is widely expected to leave rates unchanged on Wednesday, with markets focused on its signal for December, when traders put the chance of a hike at around three in four. September's US inflation and third-quarter GDP data follow on Thursday. Sources: CNBC Indonesia via Jawawa, Bloomberg via Rigzone and Wall Street Journal.