Spot gold edged lower on Thursday as the dollar rebounded versus the euro and investors assessed the latest standoff over Greece's bailout.
Spot gold, stronger initially, fell 0.5 percent to $1,206 an ounce, erasing gains made after minutes from the U.S. Federal Reserve showed it was still hesitant about raising interest rates. U.S. gold futures for April delivery gained $7.40 an ounce to settle at $1,207.60.
Spot prices had fallen to a six-week low of $1,197.56 on Wednesday, when investors saw greater potential for a successful resolution to Greece's debt talk. Prices bounced back after minutes from January's Federal Reserve policy meeting showed concern about raising interest rates too soon.
On Thursday, the German finance ministry rejected a new proposal from Athens for an extension of its bailout program, saying it fell short of the conditions set out by Greece's euro zone partners.
Even so, Greece's wording of a document seen by Reuters appeared to go substantially toward the position taken by euro zone finance ministers in early negotiations. That reassured bond investors a deal may not be far away.