The dollar index was steady after falling about 0.6 per cent on Monday.
The fact that gold again breached $1,800 level says that the market is still quite concerned about the Delta variant, OCBC Bank economist Howie Lee said.
IHS Markit data showed US business activity growth slowed for a third straight month in August, with the fast spreading Delta variant weakening the momentum of the rebound.
Investors are now focused on Fed Chair Jerome Powell's speech at the annual Jackson Hole, Wyoming, symposium as they await guidance on the central bank's taper plans.
Jackson Hole is likely to be a non-event, anything else would be a bonus, Lee said, adding "if the bonus is on the dovish side then we will see gold prices pick up probably back to the $1,850 level."
Easing worries of an imminent tapering helped buoy the Asian shares on Tuesday.
"The $1,850 level is everything for gold and if after the Jackson Hole Symposium, prices can't make a fresh August high, bullion investors might be quick to the sidelines," Edward Moya, senior market analyst at OANDA said in a note.
Meanwhile, holdings of SPDR Gold Trust, fell 0.5 per cent to 1,006.66 tonnes on Monday, their lowest since April 2020.
Silver fell 0.4 per cent to $23.56 per ounce, while platinum edged 0.2 per cent lower to $1,011.66.
Palladium was up 0.2 per cent at $2,403.76. Prices climbed 5.5 per cent in the previous session, the biggest one-day gain since May 2020.