By Clara Denina
LONDON (Reuters) - Gold slipped to one-week lows on Thursday as the dollar gained after the U.S. Federal Reserve's latest policy outlook was deemed less dovish than some had wagered on.
The metal had gained ground over the past two weeks, hitting a five-week high on Tuesday in anticipation of the Fed's decision.
But it fell after the U.S. central bank did not sound quite as alarmed about the state of the economy as some had anticipated, although it kept its $85 billion-a-month stimulus plan intact.
"The market was expecting that in light of the government shutdown and weaker data there was going to be a supportive statement, perhaps more dovish than it has been in recent months, but it didn't move in that direction," Macquarie analyst Matthew Turner said.
Spot gold was down 0.5 percent at $1,335.36 an ounce by 1102 GMT, after falling to its lowest since October 24 at $1,330.16.
Comex gold futures slipped 1 percent to a one-week low of $1,330, while silver dropped nearly 3 percent.
The dollar hovered near a two-week high and U.S. Treasury yields stood above 2.5 percent.
Gold prices have fallen nearly 20 percent this year in the expectation of an imminent scaling back of monetary stimulus by the Fed, but a budget battle in Washington and a string of weak economic data had raised questions over whether it would begin that process this year, giving bullion a boost.
"With this event risk now behind us, the market will go back into data-watch mode," said ANZ analyst Victor Thianpiriya. "For gold, the intraday moves will continue to be driven by gyrations in the U.S. dollar."
The market will monitor U.S. weekly jobless claims at 1230 GMT and Chicago PMI numbers for October at 1345 GMT.
Bullion was also undermined by slow physical buying in Asia, especially China.
Prices on the Shanghai Gold Exchange have trended lower than global prices due to fears of a cash crunch.
Net purchases by the Chinese from Hong Kong, however, totalled 110.914 tonnes in September, compared with 110.505 tonnes in August, according to data from the Hong Kong Census and Statistics Department.
Spot silver was down 1.3 percent to $22.32 an ounce, well below its highest since September 20 at $23.06 hit in the previous session.
Spot platinum fell 0.8 percent at $1,458.90 an ounce. Spot palladium lost 0.3 percent at $740.72 an ounce.
(Additional reporting by A. Ananthalakshmi in Singapore; editing by Jason Neely)