Gold prices held steady on Wednesday and headed for a monthly gain, supported by rising optimism surrounding U.S. interest rate cuts, while focus shifted to Federal Reserve's policy verdict due later in the day.

Spot gold held its ground at $2,407.85 per ounce, as of 0200 GMT, and has gained more than 3% for the month. U.S. gold futures edged 0.1% higher to $2,405.60.

At the conclusion of Fed's two-day meeting later on Wednesday, expectations are that the U.S. central bank will hold rates steady and policymakers will lay the groundwork for a September rate cut.

"The market wants to hear a confirmation that a September cut is on the cards and it will be the beginning of a policy easing cycle. Gold will rally if the Fed language indicates that multiple cuts are coming," said Kyle Rodda, a financial market analyst at Capital.com.

The U.S. rate futures market has fully priced in a 25-basis-point cut in September. Non-yielding bullion tends to thrive in a low interest rate environment.

Traders will also keep an eye on the ADP employment report due later in the day and Friday's U.S. payrolls report. Data on Tuesday showed that U.S. job openings had dropped 46,000 to 8.184 million by the last day of June.

On the geopolitical front, the United States carried out a strike in Iraq in self-defence, U.S. officials told Reuters, as regional tensions rose after an Israeli airstrike in Beirut that Israel said killed Hezbollah's most senior commander.

Safe-haven demand for gold will spark if there is significant escalation in tensions and the war opens up further in the northern border of Israel, Rodda said.

Spot silver rose 0.2% at $28.44 per ounce.

Platinum gained 0.7% to $966.13 and palladium edged 1% higher at $898.13. Both the metals headed for monthly decline.

(Reporting by Ashitha Shivaprasad in Bengaluru; Editing by Sherry Jacob-Phillips)