Gold was mostly steady on Wednesday in Asia with the Bank of Japan's latest policy review ahead and investors also braced for a U.S. Federal Reserve decision on interest rates later in the day.
Gold for December delivery on the Comex division of the New York Mercantile Exchange inched up 0.03% to $1,318.65 a troy ounce.
The Bank of Japan policy meeting results on Wednesday could see crucial changes to its easing program that include a possible interest rate cut deeper into negative territory, tweaks to its asset-purchase program or new rules on the duration of securities it will purchase in the bond market.
The BoJ has already implemented negative interest rates on some bank holdings and is printing ¥80 trillion ($750 billion) a year to stimulate inflation after decades of deflation and stagnant growth, yet inflationary expectations appear to be weakening.
Also in Japan, trade balance data for August is due with a surplus of ¥202 billion expected and imports down 17.8% and exports at a 4.8% decline year-on-year.
Overnight, Gold prices held steady in familiar territory during North America's session on Tuesday, with investors largely sitting tight. On Monday, prices tacked on $7.60, or 0.58%, as the U.S. dollar slipped amid expectations of no rate change from the Fed.
While the overwhelming consensus is for the Fed to hold rates steady at the conclusion of its policy meeting on Wednesday, some market players expect it to drop a clearer hint that it is ready to raise rates by December.
The precious metal is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar in which it is priced. A gradual path to higher rates is seen as less of a threat to gold prices than a swift series of increases.
