Gold eased on Thursday after its biggest one-day jump in a month ahead of a Federal Reserve policy decision that has investors divided on whether it will raise US interest rates for the first time in nearly a decade. The US central bank will conclude a two-day policy meeting with a decision on interest rates at 1800 GMT on Thursday. A hike is likely to weigh on gold, as higher rates lift the opportunity cost of holding non-yielding bullion. Spot gold was down 0.1 percent at $1,118.36 an ounce at 1350 GMT. It rose 1.3 percent on Wednesday in its biggest daily jump since Aug. 20, helped by data showing US consumer prices unexpectedly fell in August. US gold futures for December delivery were down $1.20 an ounce at $1,117.80. Expectations that the Fed will increase rates at this week's meeting have been lowered due to concerns over slowing economic growth in China and volatility in financial markets. In a Reuters poll of 80 economists, 45 said the Fed would keep its benchmark interest rate between zero and 0.25 percent, while 35 expected a hike. "It is a very close call - we think that going into the meeting, the outcome is undecided," Capital Economics analyst Caroline Bain said. "But relative to the market, we have a higher expectation that the Fed will hike rates this evening." "We suspect that the gold market has now largely adjusted to the prospect that the Fed will start to raise rates by end-year, so any price weakness in the immediate aftermath is likely to prove short-lived." Uncertainty over the Fed's decision kept gold in a narrow range early this week, but the metal rallied on Wednesday after data showing the surprise dip in U.S. inflation last month. Signs of a disinflationary trend in the United States contrast with a fairly healthy economy and a falling unemployment rate, and highlight the dilemma Fed officials face as they contemplate raising rates this year. If the Fed leaves rates unchanged, the upside for gold would be limited as the move would create more uncertainty over the timing of an eventual rate hike, traders said. "If the Fed doesn't make any announcement on raising rates then you could see a rally in gold because the dollar and yields will come off," Societe Generale analyst Robin Bhar said. "However, gold would struggle above $1,140 or $1,150." Silver was up 0.3 percent at $14.93 following a 3.5 percent jump in the previous session. Platinum was down 1.1 percent at $957.74 an ounce and palladium was down 2.3 percent at $595.75.