Gold rose on Friday on concerns about a prolonged U.S. government shutdown at a time when global growth is already slowing, with markets waiting on U.S.-China trade talks due next week.
Spot gold rose 0.3 percent to $1,284.31 per ounce, as of 0726 GMT, while U.S. gold futures climbed 0.3 percent to $1,283.10 per ounce.
Investors are worried about the economic impact of the longest U.S. government shutdown in history, now in its 34th day, with two bills to end the partial shutdown failing to win enough votes in the Senate.
"There are some positive features supporting gold like the U.S. government shutdown, ongoing trade war and potential for slower rate hikes," said John Sharma, an economist with National Australia Bank.
"At the moment, people are waiting for the U.S.-China trade discussions," Sharma said, adding that any development on that front could provide a direction for gold.
The United States and China are "miles and miles" from resolving trade issues, U.S. Commerce Secretary Wilbur Ross said on Thursday.
Concerns about a slowing global economy and hopes that the U.S. Federal Reserve will pause its multi-year rate hike cycle are supporting gold, analysts said.
A synchronised global economic slowdown is under way and any escalation in the U.S.-China trade war would trigger a sharper downturn, according to the latest Reuters polls of hundreds of economists from around the world.
"We expect that a topping out of U.S. real yields will put a firmer floor under gold prices this year and Fed's hiking cycle to peter out in 2019," said Sabrin Chowdhury, commodities analyst at Fitch Solutions.
"Global risk-aversion will rise in 2019 and flows into safe- haven assets, including gold, are likely to pick up."
Meanwhile, the dollar index, which measures the greenback against a basket of currencies, fell 0.2 percent, after a report that Northern Ireland's Democratic Unionist Party has privately decided to offer conditional backing for Prime Minister Theresa May's Brexit deal next week.
A softer dollar makes gold less expensive for holders of other currencies.
Technically, spot gold has found a support at $1,278 per ounce, and it may hover above this level or bounce towards a resistance at $1,289, according to Reuters analyst Wang Tao.
Among other metals, palladium, which hit a record high of $1,434.50 an ounce last week on low inventories and rising demand, was up 0.2 percent at $1,322.13 on Friday.
It registered its biggest intraday percentage decline since Dec. 21 on Thursday, falling 2 percent to $1,313.50. The metal was also heading for its first weekly fall in five, down 4 percent so far this week.
Silver rose 0.5 percent to $15.38 per ounce, while platinum gained 0.2 percent to $802.50.