US dollar weakness helped boost gold prices on Thursday, but gains were limited as the market awaited clues from next week's meeting of the Federal Reserve on the pace of US interest rate rises.
Spot gold rose 0.24 percent to $1,299.05 an ounce by 1:34 p.m. EDT (1734 GMT), earlier hitting a one-week high, $1,303.08. US gold futures for August delivery settled up $1.60, or 0.1 percent, at $1,303 per ounce.
"The rise in prices is due to the dollar," said Capital Economics analyst Simona Gambarini.
A weaker dollar is good for gold because it makes the metal cheaper for buyers using other currencies and can fuel demand.
However, Gambarini said investors were in wait-and-see mode ahead of the Fed meeting on June 12-13, when they expect both a rate rise and signals on the outlook for US monetary policy.
Higher US interest rates tend to boost the dollar and also push up bond yields, reducing the appeal of non-yielding bullion.
"Gold steady and better again with more short covering as we await six days to the next Fed meeting," said George Gero, managing director of RBC Wealth Management. "Notes and probable rate hikes all priced in."
Fibonacci technical support was at $1,286, said analysts at ScotiaMocatta.
Meanwhile, silver gained 0.8 percent at $16.78 an ounce after rising to its highest since April 23, $16.90.
Silver broke above its 100-day moving average on Wednesday and its 200-day moving average on Thursday, improving its technical outlook and triggering buying.
Commerzbank said the moves higher suggest a recovery towards $17.50-$17.74.
Platinum lost 0.2 percent at $900.40 an ounce, while palladium dropped 0.2 percent at $1,014.50, earlier reaching $1,029, its highest since April 23.
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