Gold prices traded in a narrow range on Thursday, after hitting a one-week high in the previous session, amid an easing dollar and as markets awaited the US Federal Reserve's June policy meeting minutes for outlook on monetary policy. Spot gold held steady at $1,254.85 an ounce as of 0715 GMT. The metal touched a one-week high at $1,261.10 in the prior session and gained over $20 from Tuesday's low of $1,237.32 an ounce, its weakest since Dec. 12.
US gold futures for August delivery were 0.2 percent higher at $1,255.70 an ounce. "Traders have their focus on the FOMC (Federal Open Market Committee) minutes and the general stance is that the minutes are going to be hawkish," said ThinkMarkets chief market analyst Naeem Aslam.
"Moreover, we have the US NFP (non-farm payrolls) data due tomorrow, one would not like to have any bullish bets on gold when the labour market trend is strong." Gold is highly sensitive to rising interest rates, as these increase the opportunity cost of holding non-yielding bullion, while boosting the dollar in which the metal is priced.
"Gold, however, remains in a bit of a conundrum as political instability and escalating trade war triggers a buy signal, yet the steady US dollar strength continues to nip those ideas in the bud," said Stephen Innes, APAC trading head at OANDA.