Gold futures tried for back-to-back gains Thursday as the dollar wavered. "Reuters reported that 'spot gold had edged up 0.1 percent to $1,233.16 per ounce at 0053 GMT, while US gold futures were up 0.1 percent at $1,234.6".
Concern over U.S. President Donald Trump's policies, as well as elections in the Netherlands, France and Germany this year, have fueled gold's rise to a peak of $1,244.67 on February 8.
"It's a tug of war between a higher probability of a US rate hike in March and upcoming elections around Europe, which are creating uncertainty and demand for safe assets", said Jens Pedersen at Danske Bank.
Gold's gain Wednesday snapped what had been a four-session, more than 1%, fall, stoked by expectations for dollar-boosting higher US interest rates following comments this week from Federal Reserve Chairwoman Janet Yellen.
"As of today, the price of gold is under pressure as the dollar index approaches the 101 level again and ten-year bonds yields advance", adds Pehowich. "We remain cautious (on gold), given our expectation for solid growth, rising interest rates and a strengthening United States dollar", Julius Baer said in a note.
Gold for April delivery was recently up 0.7% to $1,241.70 a troy ounce on the Comex division of the New York Mercantile Exchange, on track to close at its highest level since November 10.
USA residential construction and employment data on Thursday showed that the economy continued to rebound.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, increased for an 11th consecutive day on Wednesday.
The key "outside markets" on Wednesday morning find the USA dollar index trading higher and hitting a three-week high overnight.
The metal used in emission-controlling catalytic converters for the automotive industry has risen 17 percent this year.
MCX Gold on Tuesday closed 0.02 per cent, or Rs 7, down at Rs 29,014 per 10 gram, while MCX Silver settled 0.21 per cent, or Rs 88, up at Rs 42,510 per 1 kg.
Palladium fell 0.2 per cent to US$788.00 per ounce, after touching its highest since Jan 24 at US$792.70 earlier in the session.