Spot gold fell 0.1% to $1,774.78 per ounce by 12:32 p.m. (1632 GMT), after dipping to its lowest since April 16 at $1,762. U.S. gold futures fell 0.3% to $1,774.20.
"You're going to see the Fed affirm the dovish (stance) and that should keep gold fairly stable," Edward Moya, senior market analyst at OANDA, said of the price movement.
Fed Chairman Jerome Powell is expected to reaffirm easy monetary policy will continue for a prolonged period.
"The marketplace will closely scrutinize the Fed's inflation outlook and any comments on the future path of monetary policy," Kitco Metals senior analyst Jim Wyckoff said in a note.
While gold is considered a hedge against the inflation that could follow widespread stimulus, elevated Treasury yields have dulled non-yielding bullion's appeal this year.
Benchmark U.S. 10-year Treasury yields were steady, having earlier jumped to a two-week high.
"If the Fed gives some direction to yields, there could be a significant move for gold. Otherwise, expect gold to remain in the $1,750-$1,800 range," Carlo Alberto De Casa, chief analyst at ActivTrades, said.
Analysts have cut their gold price forecasts, with many believing an economic recovery could impede the metal's return to last year's record highs, a Reuters poll showed.
Goldman Sachs, however, sees gold at $2,000 an ounce over the next six months and said it was too early for bitcoin to compete with gold for safe-haven demand.
Elsewhere, palladium dipped 0.5% to $2,927.14 per ounce, having hit an all-time high of $2,962.50 on Tuesday.
Silver fell 0.6% to $26.08 per ounce, after reaching a low since April 21 at $25.80.
Platinum slipped 1.5% to $1,209.85 per ounce.
(Reporting by Eileen Soreng and Nallur Sethuraman in Bengaluru; Editing by Emelia Sithole-Matarise and Alexander Smith)
By Eileen Soreng
