Gold futures on the COMEX division of the New York Mercantile Exchange fell on Wednesday, as a stronger U.S. dollar and a climb in U.S. equities lured some investors away from the precious metal.
The most active gold contract for February delivery fell 6.7 dollars, or 0.4 percent, to settle at 1,655.5 dollars per ounce.
The precious metal jumped by 15.9 U.S. dollars an ounce, or around 1 percent, on Tuesday, amid signs of increased demand in China in the run-up to the Chinese Lunar New Year.
Some investors believe that quantitative easing of the U.S. Federal Reserve will come to an end as the U.S. economy improves in 2013. According to market analysts, this would likely provide a boost to the greenback, which tends to weigh on prices for dollar- denominated commodities such as gold.
Gold fell on Wednesday as the dollar pushed higher against the Japanese yen after a short-lived corrective rebound that sent the Japanese currency higher.
Investors also favored the U.S. equities, as the benchmark stock indexes went up after a two-day decline. However, some analysts believe that continued demand for gold from China would provide support for the precious metal.
Silver for March delivery also fell 21.6 cents, or 0.71 percent, to close at 30.249 dollars per ounce.