Gold prices have seen a partial recovery after experiencing a significant drop of over 2% in the previous session. Investors are closely monitoring the upcoming release of the Federal Reserve's January meeting minutes, seeking clearer guidance on the future trajectory of interest rates. As of early Wednesday, gold prices in spot trading rose 1.1% to $4,931.61 per ounce, bouncing back from a week's low encountered the previous day.

According to a report from Investing.com, gold prices continued to climb during Asian trading sessions, with spot gold rising 1.2% to $4,934.16 per ounce, while American futures contracts for April delivery increased by about 1%. However, trading volumes were reportedly limited due to the Lunar New Year holidays in Asia, which constrained the extent of price fluctuations. Analysts note that the market is in a delicate balance, heavily influenced by expectations surrounding monetary policy adjustments by the Federal Reserve.

Ajay Kedia, the director of Kedia Commodities based in Mumbai, commented on the technical rebound of gold prices, noting that surpassing the $4,850 mark has offered some optimism for traders. This situation underscores the mixed sentiments prevailing in the market, where investors are weighing the implications of potential changes in interest rates against the backdrop of ongoing economic uncertainties, influencing their decision-making regarding gold investments.