PRECIOUS-Gold rises over 1% as caution sets in ahead of Fed meeting

* Fed statement due at 1800 GMT on Wednesday
* Wall Street's S&P 500 and Dow Jones indexes fall
* Palladium down 30% from February's record peak

(Updates prices)
By Asha Sistla
June 9 (Reuters) - Gold jumped more than 1% on Tuesday as
risk appetite took a back seat with cautious investors awaiting
clarity on the state of the economy and further stimulus from
the U.S. Federal Reserve's policy meeting.
Spot gold XAU= gained 1.2% to $1,714.78 per ounce by 2:00
p.m. ET (1800 GMT). U.S. gold futures GCcv1 settled up 1% to
$1,721.90.
"The expectations of further Fed stimulus are in the
forefront of what's been supporting gold over the last couple of
days. In addition, we're also seeing global equities tick lower
slightly across the board," said David Meger, director of metals
trading at High Ridge Futures.
"We're seeing an unprecedented amount of global liquidity
and that underlying fundamental environment is extremely
supportive for gold."
Massive global stimulus to limit the economic damage from
the coronavirus pandemic has supported gold, considered a hedge
against inflation and currency debasement.
Major Wall Street indexes fell, while tech-heavy Nasdaq hit
a record high for the third straight session ahead of the Fed
meeting, which could offer views on recent signs of economic
recovery. .N
Last week's stronger-than-expected U.S. employment report
will most likely be discussed at the meeting ending Wednesday,
while traders have stopped pricing in the possibility of
negative interest rates.
In April, Fed Chair Jerome Powell said the U.S. economy
could feel the weight of the economic shutdown for over a year.

Elsewhere, silver XAG= dropped 1.2% to $17.64 an ounce
while platinum XPT= rose 0.5% to $836.52.
Palladium XPD= dipped 4.1% to $1,939.50, with prices of
the autocatalyst metal now down over 30% from a record peak in
late February.
"The corona crisis has led to a collapse in palladium
demand, while supply disruptions for platinum outweighed this.
Platinum should rise in line with gold, whilst palladium should
benefit from a recovery in demand from automobile production," a
Commerzbank analyst said in a note.