By Clara Denina
LONDON (Reuters) - Gold edged lower on Wednesday as cautious investors awaited a Federal Reserve statement that could give clues on the timing of a U.S. interest rate increase.
Spot gold was down 0.3 percent at $1,178.70 an ounce by 0959 GMT. Platinum fell to its lowest since April 2009 at $1,068.75 an ounce, trading at the cheapest to gold since 2012, with a discount of more than $100 to the yellow metal.
"The Fed policy move will be the trigger for gold prices to fall towards $1,125 or just below that before the end of the year," Deutsche Bank analyst Michael Lewis said.
"The rate move is a pretty 50/50 call between September and December and it's very data-dependent."
All eyes will be on the Fed's statement due at 1800 GMT after its two-day policy meeting. This will be followed by Fed Chair Janet Yellen's news conference half an hour later.
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Analysts expect her to focus on signs the economy is recovering after a bumpy start to the year and will scrutinise her comments for pointers to the timing of the first U.S. rate rise in nearly a decade.
Expectations for an interest rate hike this year and a stronger dollar have weighed on the price of gold over the past few months, as this would increase the opportunity cost of holding the non-interest-bearing asset.
Gold was depressed by steadier 10-year U.S. benchmark bond yields, in spite of a slightly lower dollar, down 0.2 percent versus a basket of main currencies.
Markets also monitored the protracted Greek crisis, where relations between Athens and its creditors have become increasingly acrimonious, leaving little hope that a meeting of EU finance ministers on Thursday will make any progress.
"The fears on Greece have not done anything for gold, probably because it is viewed as Greece is ring-fenced and spillover effects are maybe perceived as slightly less likely than in the past," Deutsche Bank's Lewis said.
Gold is typically seen as a good bet in times of financial and economic uncertainty, but bids have failed to emerge in a robust way as market focus has shifted towards signs of strength in the U.S. economy and the timing of a rate rise, traders said.
The metal's technical picture was bearish, leaving prices vulnerable to a break towards a low near $1,160 reached last month, ScotiaMocatta said.
Silver was down 0.4 percent at $15.94 an ounce, while palladium fell 0.3 percent to $732 an ounce.
(Additional reporting by A. Ananthalakshmi in Singapore; Editing by Dale Hudson)