Gold rose 1 percent on Tuesday, recovering from near six-year lows as news that Turkish fighter jets had shot down a Russian-made warplane near the Syrian border sparked a rush to safety among investors, weighing on the dollar.
The metal remained under pressure, however, from expectations the Federal Reserve will press ahead with its first interest rate rise in nearly a decade next month.
The U.S. dollar fell as investors piled into safe-haven currencies on concerns about rising tension between Russia and Turkey, shrugging off positive U.S. economic data.
Stocks retreated and investors sought safety in low-risk government debt and the Japanese yen after Turkish jets shot down a Russian warplane near the Syrian border.
President Vladimir Putin called the downing of the Russian fighter jet a stab in the back, saying it would have serious consequences for Moscow's relations with Ankara.
"This is a clear escalation of the crisis, which should lift gold," Commerzbank analyst Carsten Fritsch said.
The metal slid to its lowest since February 2010 last week at $1,064.95 an ounce, and pressed back to within a few dollars of that level on Monday as the dollar hit an eight-month high against a currency basket. Gold has since recovered, but remains vulnerable, analysts said.
"If the dollar continues to strengthen, gold will soften. It won't necessarily be a smooth trajectory, but I don't see any reason why it should pick up," Citi analyst David Wilson said.
"Markets are still targeting that December rate hike. If you look at the relationship with the dollar this year, that's really the driver."
Gold tends to benefit from ultra-low U.S. rates, which cut the opportunity cost of holding non-yielding bullion, while weighing on the dollar. Its 9 percent drop this year has come largely on the back of rate hike speculation.
The platinum market deficit will shrink this year, before moving into a small surplus in 2016 as supply from mining and recycling rises and investment falls, the World Platinum Investment Council said in a report.