Gold prices moved higher on Wednesday, as sentiment on the greenback weakened ahead of the Federal Reserve monetary policy decision due later in the day.

Comex gold futures were up 0.21% at $1,314.7 a troy ounce by 03:05 a.m. ET (07:05 GMT), off the previous session's two-week lows of $1,306.8.

The Fed is widely expected to raise rates by a quarter point at the conclusion of its two-day policy meeting on Wednesday, but investors will mostly be focusing on any indications as to the pace of monetary policy tightening for the remainder of the year.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.24% at 89.79.

Gold is sensitive to moves in both U.S. rates and the dollar. A weaker dollar makes gold less expensive for holders of foreign currency, while a rise in U.S. rates lifts the opportunity cost of holding non-yielding assets such as bullion.

Investors were also cautious amid ongoing fears of a potential trade war. The White House is expected to unveil up to $60 billion in new tariffs on Chinese imports by Friday, targeting technology, telecommunications and intellectual property.