Shifting talk on a possible U.S.-China trade deal is keeping gold bugs away until further clarity emerges.

U.S. gold futures fell for a second day in a row Tuesday as a lack of compelling factors prompted investors to follow the trade war political theater that again proved inconclusive.

COMEX gold futures for February delivery settled down $8.80, or 0.7%, at $1,219.90 per troy ounce.

Larry Kudlow, the White House’s top economic adviser, was pessimistic about the prospect of a ceasefire in the U.S.-China tariff battle ahead of a planned Friday summit between President Donald Trump and Beijing's Xi Jinping at the G20 in Buenos Aires, the Financial Times reported.

Kudlow, director of the U.S. National Economic Council, said it was up to Xi to “step up and come up with new ideas,” adding that for now he couldn't find much change in China's approach.

But CNBC quoted Kudlow saying the Trump administration has restarted talks with the Chinese government "at all levels."

A day earlier, Trump, in an interview with The Wall Street Journal, said it was “highly unlikely” he would accept Beijing’s request to hold off on Washington’s plans to boost tariffs to 25% on some $200 billion of Chinese goods, due from Jan. 1.

The dollar index, a contrarian bet to gold, was up 0.3%.

Walter Pehowich, a gold industry executive and commentator, said investors were likely to sit out of major new positions in bullion until the Trump/Xi summit.

“Every market is waiting for affirmation on whether a U.S.-China trade deal is happening and we’ll not know for sure till Friday,” said Pehowich, executive vice-president of investment services at Dillon Gage Metals in Addison, Texas.

“There’ll definitely be a flight to safe havens if the trade talks collapse," he said. "But if for any reason the uncertainty continues after Friday, we’ll need to cross the recent barrier of under $1,232 to establish new technical strength.”

Gold bugs are also waiting for a couple of Federal Reserve events over the next two days to gauge the central bank's latest stance on monetary policy.

Fed Chairman Jerome Powell is due to speak on Wednesday on "The Federal Reserve's Framework for Monitoring Financial Stability" at the New York Economic Club. The central bank will be issuing minutes of its Nov. 7-8 meeting the following day.

The Federal Reserve is widely expected to raise U.S. interest rates for a fourth time this year at its December meeting and both of this week's Fed events are expected to be scrutinized closely by investors for cues on gold market direction.

Fed Vice Chair Richard Clarida, in a speech on Tuesday, said the central bank ultimately wanted the smallest balance sheet possible while still being able to control its policy rate.