Gold today dropped to trade near a one-month low as a stronger dollar damped demand for commodities, overshadowing the highest ever holdings in exchange-traded products (ETP) backed by bullion.

Gold slid 0.1 per cent to $1,691.67 an ounce after falling 0.4 per cent to $1,687.15 an ounce, the least expensive since November 6.

Silver fell for a third day, losing 0.2 per cent to $32.79 an ounce.

A few dozen Republicans joined a bipartisan call to break an impasse between President Barack Obama and House Speaker John Boehner to avoid spending cuts and tax increases in January, known as the fiscal cliff.

The US Dollar Index, which tracks the greenback against six major partners, gained 0.2 per cent today. The European Central Bank policy makers may today refrain from cutting interest rates further.

The ECB policymakers meeting in Frankfurt, likely to hold the benchmark rate at a record low of 0.75 per cent.

Holdings in ETPs climbed to 2,627.59 tonnes.