Gold settled a tick lower at $1,275 on Tuesday as positive housing and consumer confidence data boosted the dollar, and as speculation that the Federal Reserve is set to wind down its monetary stimulus further weighed on prices.
The metal rose in choppy trading earlier in the day after comments on liquidity from China's central bank arrested a slide in the broader financial markets, but it underperformed other assets as concerns over Fed policy lingered.
Gold remains on track for its biggest quarterly loss in more than 30 years after the Fed gave the clearest signal yet that it plans to taper its $85 billion monthly bond-buying program.
Spot gold was down 0.3 percent at $1,277 an ounce, off an earlier low of $1,273, though it continued to underperform other precious metals, as well as oil and copper.
"Gold seems to have lost some of its bounce," said Sharps Pixley CEO Ross Norman. "You're not seeing it push back much after selling. When we do get good news, the moves are tentative.
"We've also had a raft of forecasts out today which are not good for gold," he added.