By Clara Denina
LONDON (Reuters) - Gold fell around 1 percent on Tuesday as global equities rose after Russian President Vladimir Putin's latest comments on Crimea lifted appetite for risk, while investors awaited a U.S. Federal Reserve policy meeting.
In a speech to a joint session of parliament, Putin said Russia does not want to seize more of Ukraine after approving plans to make Crimea part of Russia.
Spot gold was down 0.8 percent an ounce at $1,355.81 by 1501 GMT. The metal rallied on Monday to a six-month high at $1,391.76 before investors started to cash in profits.
U.S. gold futures for April delivery fell as much as 1.5 percent to a session low of $1,351.10 an ounce, before trading at $1,356.50, down $16.40.
"It is very difficult to trade that type of event risk like Ukraine because it could end any day and to buy gold only on the back of that it is not sustainable and that's why we see that support fade ...until some new headline comes out again," Standard Bank analyst Walter de Wet said.
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European shares, lower initially, bounced back after Putin's speech, while U.S. stocks opened in the positive territory. The dollar rose 0.2 percent against a basket of currencies after data U.S. consumer prices rose, albeit marginally, in February.
Ukraine's mainly Russian-speaking region of Crimea voted overwhelmingly in a weekend referendum, condemned by Western states, in favour of joining Russia.
The United States and the European Union imposed personal sanctions on Monday on Russian and Crimean officials involved in the seizure of Crimea from Ukraine as Putin signed a decree recognising the region as a sovereign state.
Gold has risen 13 percent this year and was headed for its biggest quarterly gain for at least seven years as mounting geopolitical tensions and fears over slowing economic growth spurred demand for the metal as an insurance against risk.
FED AHEAD
Traders were now awaiting the U.S. Federal Reserve's two-day policy meeting starting later on Tuesday.
The U.S. central bank is expected to stick to reducing its monthly asset purchases by an additional $10 billion, so the impact of such a decision on gold could be limited.
A series of U.S. economic data showing growth has been hurt by severe cold weather in the first two months of the year had hit the dollar, in turn bolstering gold. A weaker U.S. currency makes dollar-denominated assets such as gold cheaper for foreign investors.
But better-than-expected U.S. jobs and industrial output reports over the past week indicated the U.S. economy was improving after a winter slowdown.
"The U.S. data has picked up a bit more recently, we have seen a better jobs report, so the case for tapering is reinforced and the big unknown tomorrow is the kind of wording that (Federal Reserve Chair) Janet Yellen will use," Saxo Bank senior manager Ole Hansen said.
The physical market saw some selling, with demand from top consumer China likely to be muted in coming weeks as domestic prices stayed at discounts to cash gold.
In other precious metals, silver fell 1.7 percent to $20.75 an ounce. Platinum was down 0.3 percent at $1,454.75 an ounce and palladium lost 1.3 percent at $759.90 an ounce.
(Additional reporting by Lewa Pardomuan in Singapore; Editing by Stephen Powell, Dale Hudson and David Evans)