BENGALURU - Gold edged up on Tuesday as a recent dip to multi-week lows attracted some bargain hunters, but prices were well within recent ranges as the dollar remained on an upward trajectory.
Spot gold edged 0.3 percent higher to $1,191.41 per ounce at 1129 GMT, having fallen to a more than six-week low of $1,180.34 on Sept. 28. U.S. gold futures rose 0.2 percent to $1,194.10.
"It is unusual that gold is trading higher even with the stronger dollar. People are looking to buy into gold as they believe that prices below $1,200 are indeed attractive," Julius Baer analyst Carsten Menke said.
A higher dollar makes bullion more expensive for holders of other currencies, curtailing demand.
Analysts said the market was likely to stay relatively range-bound, with no real catalyst to break out on either side.
"One thing in gold's favour is oil is around $85 and that will actually make investors use gold as a hedge against inflation risk," Mitsubishi analyst Jonathan Butler said.
Global benchmark Brent crude oil prices held near 4-year highs as markets braced for tighter supply due to U.S. sanctions on Iran. Gold can sometimes be seen as a hedge against oil-led inflation.
Gold has fallen for the past six months, losing 13 percent, largely due to dollar strength, with the U.S. currency benefiting from a vibrant U.S. economy, rising U.S. interest rates and fears of a global trade war.
Market participants are also on the lookout for any additional clues on the pace of interest rate hikes from U.S. Federal Reserve Chairman Jerome Powell, who will be speaking on "The Outlook for Employment and Inflation" before the National Association for Business Economics later in the day.
"In the gold market, there is no evidence that the bulls have gained any strength. Of course, the main economic data which has the ability to move the gold price needle substantially is the upcoming U.S non-farm payrolls on Friday," Think Markets UK chief markets analyst Naeem Aslam said in a note.
The Fed raised rates last week and said it planned four more increases by the end of 2019 and another in 2020, citing steady economic growth and a robust jobs market.
Rising interest rates boost the greenback by increasing the opportunity cost of holding gold.
Silver was up 0.3 percent at $14.50 per ounce. Palladium fell 0.2 percent to $1,054, while platinum shed 0.2 percent, to $819.70.