In the international market, gold prices edged lower on Tuesday on concerns over a fresh US coronavirus aid package, while a slightly weaker dollar and subdued treasury yields limited losses and investors kept a close eye on the Federal Reserve's policy meeting.
Spot gold was down 0.2 per cent to $1,851.26 per ounce at 01:53 p.m. EST (1853 GMT). US gold futures settled down 0.2 per cent at $1,850.90.
"There is no clarity on where fiscal spending is going, there is no full clarity of how the central bank is going to react ... these uncertainties are serving as a cap on gold," said Bart Melek, head of commodity strategies at TD Securities.
However, the dollar slipped from a near one-week high, raising gold's appeal for other currency holders.
"The US dollar came off a little bit and that's typically a supportive factor."
US President Joe Biden's $1.9 trillion pandemic relief proposal faces hurdles as Republicans voiced concerns over the cost and lobbied for a smaller plan targeting vaccine distribution.
"If they do reach a deal it might be a watered down version to get it through Congress, so that's also weighing on (the gold) market," said Saxo Bank analyst Ole Hansen.
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