Gold prices bounced higher on Wednesday, as the U.S. dollar weakened ahead of the Federal Reserve's highly-anticipated monthly policy decision due later in the day.

Comex gold futures were up $4.93 or about 0.39% at $1,315.68 a troy ounce by 03:00 a.m. ET (07:00 GMT), pulling away from Monday's three-week trough of $1,308.10.

Later Wednesday, the U.S. central bank was widely expected to leave interest rates on hold, but it was also likely to announce plans to trim its $4.2 trillion in bond holdings.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, wasdown 0.13%at 91.62, the lowest since September 11.

Gold is sensitive to moves in the dollar. A weaker dollar makes gold less expensive for holders of foreign currency.

The precious metal also strengthened amid potentially higher tensions between the U.S. and North Korea following harsh statements from U.S. President Donald Trump.

In his first speech before the United Nations General Assembly on Tuesday, Trump said "the United States has great strength and patience, but if it is forced to defend itself and its allies, we will have no choice but to totally destroy North Korea."