Gold prices fell over 1.5% as the U.S. dollar strengthened and investors anticipated a potentially hawkish stance from the Federal Reserve. The Federal Open Market Committee (FOMC) began its two-day policy meeting, with markets pricing in an increased probability of an interest rate hike. Higher interest rates increase the opportunity cost of holding non-yielding assets like gold, making it less attractive to investors. A stronger dollar, trading near a one-month high, also exerted pressure on gold by making it more expensive for holders of other currencies.