Gold firmed on Monday as the dollar softened, although moves were muted as markets awaited details on U.S. President Donald Trump's tax policy, and guidance on the pace of interest rate hikes from a raft of Federal Reserve speakers this week.
The metal is highly sensitive to rising U.S. rates, which increase the opportunity cost of holding non-yielding bullion while boosting the dollar, in which it is priced.
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Liquidity was thinned by the absence of U.S. traders for the Presidents Day holiday.
Spot gold was up 0.2 percent at $1,237.67 an ounce by 1440 GMT, while U.S. gold futures for April delivery were little changed at $1,238.90.
"We have settled into a $1,220-1,245 range, with activity expected to be light on Presidents Day," Saxo Bank's head of commodity strategy Ole Hansen said.
"President Trump will continue to be a key source of market inspiration. Trump's address to the joint session on Capitol Hill next Tuesday may become the next focus considering he is expected to lift the curtain on his tax cuts ideas."
The dollar has lost some support in recent weeks as a lack of concrete detail dampened post-election euphoria over Trump's commitment to cutting taxes and boosting spending.
The euro edged higher against the dollar after a slide in U.S. bond yields, shrugging off worries over upcoming French elections. The heads of five regional U.S. Federal Reserve banks are scheduled to speak this week. In addition, Fed Board Governor Jerome Powell appears on Wednesday, when minutes of the last policy meeting are also due.
Speaking in Singapore on Monday, Cleveland Fed chief Loretta Mester said she would be comfortable raising rates at this point if the economy kept performing the way it had.
Investor appetite has shown signs of easing since gold hit a three-month high on Feb. 8. The world's largest gold-backed exchange-traded fund, SPDR Gold Shares, reported an outflow of 2.4 tonnes on Friday, the first in nearly four weeks.
Data also showed on Friday that speculators cut their net long position in COMEX gold for the first time in three weeks in the week to Feb. 14.
"Whether investors continue to rotate away from non-yielding gold and towards risk assets depends on how soon details of President Trump's fiscal stimulus plans become clearer, but overall the equity rally looks to have further to run," Mitsubishi said in a note.
Silver was down 0.1 percent at $17.96 an ounce, platinum was 0.1 percent higher at $1,001.70 and palladium was down 0.5 percent at $771.30.
(By Jan Harvey; Additional reporting by Arpan Varghese in Bengaluru; Editing by David Goodman and Louise Heavens)