Gold was little changed on Thursday as the dollar cut losses after the European Central Bank said it made only marginal upward adjustments to its inflation projections, while investors remained cautious ahead of US labour data.
The ECB kept interest rates unchanged and President Mario Draghi said inflation would likely remain very low or negative in the next few months.
Spot gold was unchanged at $1,211.52 an ounce by 1409 GMT. US gold gained 0.1 percent to $1,215.80.
"In the medium term gold will remain rangebound around $1,200, where there is a good support. In the short term I am more cautious because we are entering a period of low seasonal demand for gold and then the Fed is moving towards raising rates," said N?vine Pollini, equity analyst at Union Bancaire Priv?e.
The dollar was down 0.1 percent against a basket of six major currencies, making gold cheaper for foreign currency holders.
Data on Thursday showed US private payrolls increased a less-than-expected 173,000 in May.
Investors will now focus on non-farm payrolls on Friday. A solid reading could heighten expectations for a move as early as the Fed's June 14-15 policy meeting.
"People are looking for confirmation whether the likelihood of a summer rate hike is going to increase even further," Julius Baer analyst Carsten Menke said.
"As long as fears of a summer rate hike are kept alive by the incoming macro data, the odds are much higher that speculators move away from the long side in the gold market."
Gold has taken a beating after the latest US Fed meeting minutes released in May, and comments from key central bank officials, including Chair Janet Yellen, boosted expectations of an imminent US rate rise.
Higher interest rates increase the opportunity cost of holding non-interest yielding gold, while bolstering the dollar.
The market was also focused on the European Central Bank (ECB), which left rates unchanged at record levels, as expected, ahead of the 1230 GMT news conference, where President Mario Draghi should detail the bank's new growth and inflation projections.
Spot gold is biased to revisit its May 30 low of $1,199.60 per ounce, as it has failed to break a resistance at $1,219, Reuters technical analyst Wang Tao said.
Holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 0.24 percent to 870.74 tonnes on Wednesday, the highest since November 2013.
Spot silver rose 0.5 percent to $16.01 per ounce, after slipping to $15.77 on Wednesday, its lowest since April 12. Spot platinum was down 0.2 percent at $962.45, while palladium fell 1.4 percent to $536.96.
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