Gold rose on Tuesday, in another attempt to cross the key $1,300-an-ounce level, as the U.S. dollar extended losses and as assets of the top bullion fund rose to their highest in over two years.
Gold has rallied sharply since late last week after the dollar slumped on the Federal Reserve's cautious stance towards higher U.S. rates and as the yen soared after the Bank of Japan stood pat on policy last week.
The metal rose to $1,303.60 an ounce on Monday, its strongest since January 2015, but ended the day lower on profit-taking.
Spot gold had climbed 0.2 percent to $1,293.30 an ounce by 0633 GMT, after earlier hitting a session high of $1,296.81.
"I think gold can reach $1,300-$1,400 in the second quarter. Investors are following the yen-dollar movement and central bank decisions, and the ETF inflows are a very good sign," said Mark To, head of research at Wing Fung Financial Group.
The dollar set a fresh 18-month low versus the yen on Tuesday. The dollar index hit its lowest since January 2015.
The dollar weakness and strength in the gold price rally have triggered a sharp increase in money flowing into the SPDR Gold Trust, the world's top gold-backed exchange-traded fund.
Assets of the fund rose 2.59 percent, or 20.8 tonnes, to 824.94 tonnes on Monday in its biggest increase since Feb. 22. Holdings are at their highest since December 2013.
Gold may consolidate in a range of $1,289-$1,304 for a day before rising again, Reuters technical analyst Wang Tao said.
Investors will be eyeing U.S. data this week to gauge the strength of the economy and its impact on the Fed's monetary policy.
Bullion is sensitive to rising interest rates, which lift the opportunity cost of holding non-yielding bullion, while boosting the dollar.
The key data will be U.S. nonfarm payrolls due on Friday. The U.S. economy is expected to have added 200,000 jobs in April, slightly lower than March.
"The non-farm payroll report this week may have a neutral effect on gold given that investors are confident that even if the figures are good, there would not be any move by the Fed (to hike rates) until the second half of this year," Wing Fung's To said.
Among other precious metals, was also near a 15-month high of $18.006 reached on Monday. It edged up 0.4 percent to $17.605 on Tuesday.
climbed to a fresh 10-month high of $1,085.60 in the previous session. advanced 0.3 percent to $620.