Gold was flat on Tuesday, barely budged from the prior session's two-week low, with trading lackluster as Federal Reserve policy makers headed into a two-day meeting that financial markets will watch for clues on the outlook for U.S. monetary tightening.
Trading volume was "slightly softer, which is generally to be expected ahead of the Fed," said Suki Cooper, precious metals analyst at Standard Chartered Bank in New York.
The dollar dipped slightly against a basket of currencies ahead of the Fed meeting. Analysts expect the Fed to issue a statement on Wednesday announcing that it will reduce bond purchases while leaving the door open to a U.S. interest rate hike in December.
"The dollar fell and then rose and that was basically a mirror image of today's gold market," said Bart Melek, head of commodity strategy at TD Securities in Toronto. A strengthening dollar makes gold less attractive to investors.
Gold is down 3.6 percent from Sept. 8, when it hit a one-year high of $1,357.54. On that day, the dollar hit its lowest level against a basket of currencies in more than 2½-years.
Cooper said Fed balance sheet reduction "has been widely telegraphed. At the moment we believe we'll see one more rate hike."
Spot gold was up 0.21 percent at $1,309.32 per ounce by 2:14 p.m. ET, off the previous day's low of $1,304.10.
U.S. gold futures for December delivery settled down $0.2, or 0.02 percent, at $1,310.6 per ounce.