Gold edged down on Thursday, as investors marked time ahead of the European Central Bank's monthly policy meeting and the release of U.S. jobs data that should provide clues about the strength of the economy.
Spot gold was down 0.2 percent to $1,286.80 an ounce by 0948 GMT. It had fallen to a seven-week low of $1,277.29 on Tuesday.
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Gold futures for April delivery fell $4.50 at$1,286.10 an ounce.
"The potential for gold prices to move lower in the next couple of sessions seems greater now because of the incumbent macro events," MKS SA head of trading Afshin Nabavi said.
"Although the ECB is unlikely to change the interest rates, there may be something at the press conference, which could eventually push the euro/dollar lower," he added. "And a stronger U.S. jobs number tomorrow will be seen as the final sign that previous weakness in the data was down to bad weather and that the economy is on the recovery path."
The dollar was up 0.1 percent against a basket of currencies, buoyed by a string of recent positive data showing the world's largest economy is recovering from severe winter weather conditions.
The biggest focus for the market remains Friday's payrolls data for March, which will be preceded by weekly jobless claims on Thursday.
A strong number could further bolster the dollar, making gold more expensive fo holders of other currencies.
The negative impact of any strong U.S. data on gold could, however, be cushioned by Federal Reserve chair Janet Yellen's recent defence of the Fed's easy monetary policy, analysts said.
Market players will also monitor the ECB meeting for its impact on the euro/dollar. The central bank is widely expected to keep interest rates steady and offer no new aid to the euro zone's fragile recovery despite a fall in inflation.
Traders had hoped physical demand would climb with gold prices at a seven-week low earlier in the week.
Chinese gold prices briefly rose to a premium on Wednesday before settling on par with London prices, and they have fallen back to a discount of about $2 an ounce on Thursday.
Chinese gold has been trading at discounts to London prices since early March.
Physical demand across major markets India, Thailand and Indonesia was also weak, dealers said.
Silver was down 0.3 percent to $19.88 an ounce.
Platinum rose 0.1 percent to $1,432.99 an ounce and palladium gained 0.3 percent to $782.20 an ounce.
The metals drew some support from South Africa's producer Lonmin's force majeure wih some suppliers. The move echoed announcements made by rivals Impala Platinum and Anglo American Platinum as a miners' strike is close to enter its 11th week.