Gold touched its highest in four weeks on Thursday as the dollar slipped further from a 14-year peak hit earlier this week, while palladium and platinum extended weekly gains.
Spot prices are heading for a 2.4 percent gain for the week so far, having benefited from a halt in the dollar's rise.
"Although the wider picture hasn't changed and U.S. growth is improving, there shouldn't be any further significant appreciation in the dollar after the strong run of the past few months and given uncertainty about economic policy changes going forward," Commerzbank analyst Daniel Briesemann said, adding this should be supportive for dollar-denominated gold.
The best-performing precious metal this week is palladium, up 9.2 percent this week and on course for its biggest weekly gain since July.
The metal, mostly used to clean exhaust emissions from gasoline-powered catalysts, has been bought in anticipation of record-high vehicle sales in the United States and was also boosted by a lower dollar, analysts said.
U.S. car sales December data on Wednesday showed sales of new cars and trucks rose to a record in 2016.
"We are seeing continued strong growth in car sales, which is particularly good for palladium. And in general for the industrial element, there is a very strong growth environment that is taking shape, which is supportive," ETF Securities analyst Martin Arnold said.
climbed 3.4 percent to $968.99 an ounce, after reaching its highest in nearly eight weeks at $973.50. It was heading for an 8 percent weekly gain.
The dollar extended losses against a basket of six main currencies, after data showing U.S. private employers added 153,000 jobs in December, below economists' expectations.
Minutes from the 's December meeting showed that almost all policymakers thought the economy could grow more quickly with expected fiscal stimulus under the Donald Trump administration.
At the same time, Fed policymakers "emphasized their considerable uncertainty" about future economic policy changes.
Spot gold fell more than 8 percent in November and touched a 10-month low in December on a higher dollar and U.S. Treasury yields after Trump's election win and as the Fed raised interest rates for the first time in a year. It has now increased by more than 5 percent from those lows.
Buying from China, the biggest gold consumer, is also supporting the recent rally, traders said.
"The Chinese New Year is around the corner. Gold kilobar demand is picking up right now, with strong premiums on the mainland," a Japan-based precious metals trader said.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, were unchanged on Wednesday at 813.87 tonnes. They have dropped about 14 percent since the U.S. election in November.
was up 1.4 percent at $16.66 an ounce after touching a three-week high of $16.70.