Safe-haven gold touched its highest in one year on Wednesday as recent U.S. economic data fanned fears of a slowdown and spurred bets the Federal Reserve may ease up on hiking.
Spot gold was little changed at $2,019.99 per ounce after rising to its highest since March 2022 at $2,031.89 earlier. U.S. gold futures traded flat at $2,036.40.
Gold raced past the key $2,000 level on Tuesday after a sharp drop in U.S. job openings in February, adding on to gains from earlier this week after an OPEC-led spike in oil triggered worries of another run higher in inflation.
Gold could sustain gains above the $2,000 level as economic worries grow, analysts said.
UBS forecasts gold prices to surpass their all-time high and reach $2,200 by the end of March 2024.
Softer-than-expected growth in private payrolls in March also exacerbated worries over the economic toll from the Fed's rapid rate hikes. Bullion found additional support from a subdued dollar overall, and a retreat in U.S. yields.
"That downbeat economic data we got yesterday put a little risk aversion back into the marketplace and that's beneficial for safe-haven gold," said Jim Wyckoff, senior analyst at Kitco Metals.
Traders now see a 60% chance of U.S. rate hikes pausing in May, brightening the outlook for zero-yield gold and its status as the preferred inflation hedge.
But Carsten Menke, head of Next Generation Research at Julius Baer, in a note, warned that a U.S. recession might still be avoided while a "rapid reversal" of Fed policy was unlikely.
The U.S. nonfarm payrolls data on Friday could provide further cues, although analysts said market reaction might be apparent only next week due to the Good Friday holiday.
Silver shed 0.4% at $24.93 per ounce, platinum lost 1.9% at $997.44, while palladium slipped 1.5% to $1,435.35.