Gold prices rose on Wednesday as the dollar slipped and minutes of the Federal Reserve’s last policy meeting suggested the U.S. central bank was cautious about raising interest rates.

The metal is highly sensitive to higher rates, which increase the opportunity cost of holding non-yielding bullion while boosting the dollar, in which it is priced.

Spot gold XAU= traded at $1,256.02 an ounce by 2:50 p.m. EDT (1850 GMT), up 0.42 percent from Tuesday, when it slipped 0.7 percent after two days of gains.

Minutes of the Federal Open Market Committee‘s early May meeting showed policymakers agreed to not tighten credit until they saw evidence that a recent economic slowdown was transitory.

Federal Funds Futures imply traders see an 83 percent chance of a U.S. rate hike in June, and a 46 percent chance of two more hikes by the year-end.

Gold is largely unchanged after an initial burst higher failed as May’s Fed minutes offered little to suggest that the Committee was seriously reconsidering a widely anticipated June rate hike,” said Tai Wong, director of base and precious metals trading for BMO Capital Markets in New York.

“Yields are lower though, as there was no indication that a balance sheet reduction was imminent which may support gold around today’s lows.”

Expectations for higher U.S. interest rates next month and possibly later in 2017 have been a major factor in keeping gold prices pinned below chart resistance at $1,300 an ounce this year.

Source: Reuters

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