BENGALURU - Gold prices eased on Friday as the dollar inched up, while investors remained cautious ahead of a G7 meeting later in the day and other key events next week such as a United States Federal Reserve policy meeting and a U.S.-North Korea summit.
Spot gold was 0.1 percent lower at $1,294.87 per ounce by 0658 GMT. It hit a one-week high of $1,303.08 an ounce in the previous session and has risen about 0.2 percent so far this week.
U.S. gold futures for August delivery fell 0.3 percent to $1,298.70 per ounce.
"Gold is most likely going to be range bound. The markets are looking very closely on what could actually come out from the G7 meeting," said OCBC analyst Barnabas Gan.
"The market is also looking for a potential rate hike by the FOMC ... (but) the dollar movement will dictate how gold will move into the next one week or so."
The dollar index, which measures the greenback against a basket of six major currencies, rose 0.2 percent to 93.585. [USD/]
Leaders of the Group of Seven rich nations headed for a summit in Canada on Thursday more divided than at any time in the group's 42-year history, as U.S. President Donald Trump's "America First" policies risk causing a global trade war and deep diplomatic schisms.
Trump is set to meet North Korean leader Kim Jong Un on June 12 in Singapore, and the U.S. Federal Reserve's Federal Open Market Committee (FOMC) starts its two-day meeting on interest rates on the same day.
The number of Americans filing for unemployment benefits unexpectedly fell last week, pointing to a further tightening in labour market conditions and strengthening prospects of an interest rate hike.
Gold is highly-sensitive to rising U.S. rates as these tend to boost the dollar, putting pressure on greenback-denominated, non-yielding bullion.
Spot gold may end very soon its current sideways move in a neutral range of $1,293-$1,302 per ounce, and then either rise towards $1,326 or drop towards $1,281.76, according to Reuters technical analyst Wang Tao.
In other precious metals, spot silver fell 0.1 percent to $16.63 an ounce, after marking a more than six-week high on Thursday. It was heading for a nearly 2 percent rise for the week, its biggest in seven weeks.
Palladium was down 0.5 percent at $1,007.40 per ounce. It hit a more than six-week high in the previous session and was on course for a third consecutive weekly gain, up about 1 percent.
Platinum was 0.2 percent lower at $894.80 an ounce and was on course for a marginal weekly decline.