PRECIOUS-Gold around 3-week low on easing Syria tension; awaits Fed
* Obama to pursue Russian proposal on Syria's weapons
* Fed meeting in focus as markets await stimulus trim
(Updates throughout, changes dateline from SINGAPORE)
LONDON, Sept 11 (Reuters) - Gold hovered around a three-week low hit earlier on Wednesday, remaining under pressure as hopes that a U.S. military strike against Syria could be averted dented the metal's safe-haven appeal.
U.S. President Barack Obama vowed on Tuesday to explore an initiative from Russia to neutralise Syria's chemical weapons, but he voiced scepticism and still sought support for his threat to use military force should diplomacy fail.
"The fact that the Syrian situation is all back to a diplomatic solution is something that is not really supporting gold or crude oil right now and the moves lower seen in the past sessions were merely due to that," Danske Bank analyst Christin Tuxen said.
Spot gold fell earlier to its lowest since Aug. 22 at $1,356.85 an ounce. It traded up 0.1 percent at $1,364.95 by 0953 GMT, after losses of 1.6 percent in the previous session.
U.S. gold futures for December delivery edged up $1.00 an ounce to $1,365.00.
Analysts said Syria would probably now be less of a focus for the market as the U.S. Federal Reserve meeting on Sept. 17-18 takes centre stage, with the timing and pace of monetary stimulus tapering driving dollar movements and in turn gold.
"...Ahead of the (Fed) statement ... we expect the market to once again start trading in the opposite direction to the greenback - especially if the Fed initiates a gradual tapering to its monthly asset purchases," VTB Capital said.
The Fed's stimulus has been a key driver in gold's rally in recent years, with the increased financial liquidity and record-low interest rates encouraging investors to put money into non-interest-bearing assets.
The dollar was little changed and Brent crude gained ground above $111 a barrel, after falling more than 4 percent in the past two days as fears eased of an imminent strike against Syria.
The positive correlation between gold and oil has been restored over the past month after geopolitical tensions heightened and a U.S.-led strike on Syria seemed imminent. Gold is seen as a hedge against oil-led inflationary pressures.
ASIAN PHYSICAL DEMAND SUBDUED
The physical market has yet to pick up in Asia and other regions even though gold has fallen below the psychologically key level of $1,400 an ounce.
Dealers said sales of scrap subsided in Singapore, keeping premiums for gold bars unchanged at $1 to $1.50 an ounce to spot London prices.
In top consumer India, a sharply lower rupee curbed buying interest despite an approaching festival.
Indian gold demand typically picks up between August and October, when consumers buy bullion to celebrate festivals, peaking with Diwali, which falls in November this year.
Spot silver, which fell to a three-week low of $22.75 an ounce earlier, was trading up 0.7 percent at $23.09. It lost around 3 percent on Tuesday.
Spot platinum rose 0.6 percent to $1,476.40 an ounce, while spot palladium gained 1.1 percent at $698.81 an ounce.
(Additional reporting by Lewa Pardomuan in Singapore; Editing by Dale Hudson)