Gold prices rose Tuesday as a weaker dollar outweighed pressure from hawkish remarks from U.S. Federal Reserve officials about raising interest rates.
Spot gold rose 0.8% to $1,754.85 an ounce and U.S. gold futures rose 0.8% to $1,769.70.
On Monday, gold prices had their worst day in a month, losing nearly 1 percent, following hawkish comments from Fed officials James Bullard and John Williams.
The dollar index fell 0.4 percent against its peers on Tuesday, making gold less expensive for holders of other currencies.
Although a slightly weaker dollar is supporting gold at the moment, we still expect further Fed rate hikes to put pressure on gold prices in coming weeks, said UBS analyst Giovanni Staunovo.
Fed Chairman Jerome Powell's speech at a Brookings Institution event Wednesday is now of interest to traders seeking more clarity on the central bank's policy stance.
"The market will be watching closely for any sign of an end to interest rate hikes. If Powell points out that we are close to that, gold will win, on the other hand, if he points to further hikes," Staunovo added.
The ADP national employment report and the U.S. Labor Department nonfarm payrolls data due out this week also remain on the radar.
Meanwhile, Chinese police took to the streets of Beijing and Shanghai to prevent more protests against Covid-19 restrictions.
The protests in China, the world's biggest gold consumer, and the resulting heightened security presence will affect spending and industrial activity over the next month, putting pressure on all metals, said Michael Langford, director of corporate consulting firm AirGuide.
