The dollar fell 0.5 percent against a basket of six currencies, while European stocks recovered on signs that central banks such as the Bank of England, the Bank of Japan and the European Central Bank will loosen monetary conditions even further.
Concerns about the global economy have made chances of a U.S. rate rise in coming months less likely, analysts say, but much will depend on U.S. economic data and markets will be watching non-farm payrolls due on July 8 in particular for clues.
A strong jobs report and favourable revisions for the June nonfarm payrolls data could give the dollar a boost and undermine gold and silver, at least temporarily, Razaqzada said.
Low U.S. interest rates are positive for gold because the opportunity cost of holding it decreases and the dollar typically falls, making the metal cheaper.
Societe Generale raised its gold price forecasts on Thursday on concerns about the ongoing political, financial and economic fallout of Britain's vote last week to leave the European Union.
"Looking ahead, it seems that gold will remain one of the major beneficiaries in the current backdrop, as heightened volatility and lingering uncertainty will keep investors' risk appetite in check." the bank said.
Spot platinum marked its highest level since May 18 rising as high as $1,060.90 an ounce and was on track for its best weekly rise since October last year.
Spot palladium, heading for its best week since early March, rose to its highest since May 13 at $605.40, and was up 1.5percent at $603.90.