Gold logged it biggest one day gain in about three weeks on Thursday after the European Central Bank cut interest rates to record lows and its chief Mario Draghi unveiled a package of new stimulus measures.
Dealers who had bet against gold in the run-up to the announcement rushed to cover positions as the metal held above $1,240 an ounce, traders said.
U.S. gold futures for August delivery ended $9.00 higher at $1,253.30 an ounce, its best day since May 14.
Spot gold, meanwhile, was up 0.8 percent at $1,253 an ounce, off a high of $1,256.50. It earlier dipped as low as $1,240.90, close to this week's four-month low of $1,240.61.