Updated from 10:27 a.m. ET with settlement prices

NEW YORK (TheStreet) -- Gold prices dropped Tuesday as an inflation indicator showed little change in consumer prices.

The consumer price index for November was unchanged while core inflation -- excluding food and energy -- rose just 0.2%. The absence of increased inflation comes a day ahead of a key announcement by the Federal Reserve as to whether the central bank will begin to scale back its economic stimulus program.

Gold for February delivery at the COMEX division of the New York Mercantile Exchange slipped $14.30 to settle at $1,230.10 an ounce. The gold price traded as high as $1,247.60 and as low as $1,226.50 an ounce, while the spot price was losing $10.50, or 0.85%.

"I don't think [CPI] moves the needle in either direction, particularly in this report," Liz Ann Sonders, chief investment strategist at Charles Schwab, said in a phone interview from New York. "It maybe marginally reinforces the view we're not barreling toward deflation."

Many investors view gold as an asset hedge against inflation. The Fed's multiple rounds of quantitative easing -- also known as monetary stimulus -- since the 2008 financial crisis have concerned inflation hawks. But with consumer and producer prices rising very little in the past five years coupled with a still modestly growing economy, Fed Chairman Ben Bernanke has managed to adhere to the central bank's policy of keeping low rates of inflation.

Some gold investors contend that markets will have to wait longer for long-term inflation to set in.

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