Gold fell from one-month highs on Wednesday after better-than-expected U.S. jobs data boosted U.S. bond yields and the dollar but losses were limited after minutes from the Federal Reserve's March policy meeting were released.
Bullion pared some losses after the Fed's minutes showed most policymakers think the central bank should take steps to begin trimming its $4.5 trillion balance sheet later this year as long as the economic data holds up.
Immediately prior to the release of the Fed minutes, spot gold was down 0.66 percent at $1,247.19 and gold futures fell 0.75 percent to $1,249 at 1:58 ET.
Earlier in the session, the ADP National Employment Report showed that U.S. private employers added 263,000 jobs in March, beating economists' forecasts of 187,000 additions.
"ADP was what had blown away expectation and that's really what sent it lower and put a small bid underneath the dollar index," said Phillip Streible, senior commodities broker for RJO Futures in Chicago.
"Throughout the day we've been trading at either side of $1,250, it seems like gold bulls and bears are comfortable trading around that psychological level."
U.S. 30-year Treasury yields and the U.S. dollar hit session highs immediately after the Fed minutes were released but gave up most gains later in the session.
A stronger dollar makes gold more expensive for holders of other currencies, while higher bond yields dampen demand for non-yielding bullion.
Gold touched $1,261.15, its highest since Feb. 27, on Tuesday but failed to close above its 200-day moving average, currently at $1,258, for the third time in less than six weeks.
Gold has risen 8.8 percent so far this year and has held just under its 200-day moving average since late March.
But some investors were cautious ahead of U.S. non-farm payrolls data due on Friday, where sharp gains in employment would bolster the case for rate rises and likely boost the dollar.
Gold was supported however by demand for safe assets after a chemical attack in Syria appeared to put Russia and the United States on a diplomatic collision course and North Korea fired a ballistic missile into the sea ahead of a summit between U.S. President Donald Trump and Chinese President Xi Jinping.
In other precious metals, spot silver rose 0.08 percent to $18.30 an ounce after touching a one-month peak of $18.41 in the previous session.
—CNBC's Jeff Cox contributed to this report