Gold dipped on Monday pressured by a firmer dollar, while investors focussed on the Federal Reserve's first meeting of 2025 for more guidance on the US interest rate path.
Spot gold dropped 0.6% to $2,755.80 per ounce, as of 0509 GMT, after trading just below record-high levels on Friday. US gold futures fell 0.7% to $2,760.70.
The dollar gained 0.3%, making gold expensive for other currency holders.
"The US dollar could be the main culprit for gold's weakness... However, the current movement suggests that the downside for the yellow metal is still limited, potentially aided by safe-haven flows," IG market strategist Yeap Jun Rong said.
The US and Colombia pulled back from the brink of a trade war, after the White House said the South American nation had agreed to accept military aircraft carrying deported migrants.
Gold is considered a hedge against geopolitical turmoil and inflation.
It also tends to thrive in a low interest rate environment as it yields no interest.
Fed policymakers are largely expected to keep rates steady in their Jan. 28-29 meeting, marking the first pause in the rate-cutting cycle that began in September.
Gold price per tola decreases Rs200 in Pakistan
"Market focus will likely be on how the Fed reacts to comments from President Trump, who has called for continued interest rate cuts," Reliance Securities' senior analyst Jigar Trivedi said.
Data since the Fed's December meeting has kept intact the core view among Fed officials that inflation will continue to move steadily, if slowly, towards 2%, with a low unemployment rate and continued hiring and economic growth.
COMEX gold speculators raised net long position by 21,864 contracts to 234,358 in the week to Jan. 21, data showed on Friday.
Spot silver dropped 1.1% to $30.26 per ounce, palladium dipped 1.8% to $969.93 and platinum fell 0.8% to 941.25.
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