Gold prices remained steady near a two-week high on Tuesday as the US dollar relinquished some of its recent gains, just ahead of a series of crucial central bank meetings set to begin with the US Federal Reserve later in the day.

As of 0638 GMT, spot gold showed a marginal 0.1% decline, trading at $1,930.39 per ounce. However, it hovered near its highest level since September 5, which it had reached earlier in the session. US gold futures experienced a minor dip of 0.1%, settling at $1,951.60.

The US dollar retreated from its highs of the previous week, rendering gold more affordable for international buyers. This shift in currency dynamics came ahead of pivotal central bank policy decisions scheduled in the coming days, involving the United States, Britain, and Japan.

While the Federal Reserve is widely anticipated to maintain unchanged interest rates when it announces its policy decision on Wednesday, market focus will be squarely on the central bank's outlook regarding future rate adjustments.

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Michael Langford, Chief Investment Officer at Scorpion Minerals, suggested, "Fed Chair Powell's speech is likely to highlight that inflation risks have not gone away but they are in a wait-and-see mode for inflation." He noted that global low inventories of gasoline and diesel pose a notable short-term risk to inflation targets.

The appeal of non-interest-bearing gold may diminish if the Fed continues to raise rates in an effort to manage inflation. Kirill Kirilenko, a senior analyst at the London-based consultancy CRU, emphasized, "Should inflation become increasingly sticky, fueled by robust consumer spending and a tight labor market, the Fed may be forced to keep rates elevated for longer or even hike again to bring it to the target."

In the context of such developments, Kirilenko noted that gold bulls might face challenges in sparking a significant price rally until there's growing confidence in the Fed's willingness to ease its stance and loosen financial conditions. However, this shift is not expected to materialize in 2023.

Among other precious metals, spot silver recorded a slight 0.2% decline, settling at $23.18 per ounce, while platinum saw a 0.3% dip to $930.15. In contrast, palladium experienced a 0.5% increase, reaching $1,242.01.