Gold extended gains on Wednesday on a weaker dollar and lower yields amid wider economic uncertainty, while investors positioned for the Federal Reserve's interest rate decision.
Spot gold was 0.4% higher at $2,024.19 per ounce by 1:10 p.m. EDT (1710 GMT), after touching a fresh high since April 14.
US gold futures rose 0.5% to $2,033.50.
Prices eased after data showed US private employers boosted hiring in April, but soon reversed course as 10-year Treasury yields slid and a 0.5% dip in the dollar index boosted bullion's appeal overseas.
Gold broke out of its recent range, maintaining a strong correlation with the US dollar and yields, said Standard Chartered analyst Suki Cooper. "Concerns regarding US regional banks and the debt ceiling suggest further price volatility is in the offing."
The Fed's rate decision is expected at 2:00 p.m. EDT, with markets pricing in an 85% chance of a 25-basis-point hike.
The central bank could also signal a pause in its 14-month tightening cycle, as policymakers balance the need to slow inflation against risks ranging from bank failures to the possibility of a US debt default as soon as next month.
"We're back and forth all morning about what is (Fed Chair Jerome) Powell going to say," said Bob Haberkorn, senior market strategist at RJO Futures.
If they hint at a pause to rate hikes, gold should rally significantly, or if they indicate hikes are still coming, gold will probably be sold off, Haberkorn added.
Non-yielding bullion, a customary safe haven against inflation and economic uncertainty, draws lower demand when higher interest rates boost returns on competing assets with yields.
Gold prices had gained 1% in April as the US banking crisis spurred a flight to safety.
Silver fell 0.2% to $25.35 per ounce, platinum shed nearly 1% to $1,055.15, while palladium dropped 0.2% to $1,426.46.
Reuters