Gold hit its highest in six months on Monday as cautious investors remained risk averse after Western countries issued warnings of more sanctions on Moscow following Crimea's vote to break from Ukraine.
Bullion has gained 15 percent this year and was headed for its biggest quarterly gain for 27 years as mounting geopolitical tensions and fears over slowing economic growth spurred demand for the metal as an insurance against risk.
Spot gold hit a fresh high since Sept. 9 at $1,391.76 an ounce in earlier trade and was down 0.1 percent to $1,380.05 by 1104 GMT.
U.S. gold futures also rose to a near six-month high of $1,392.60 an ounce, before trading at $1,378.80, unchanged on the previous close.
"It's definitely soft economic data, risk aversion, Ukraine and geopolitical tensions," Societe Generale analyst Robin Bhar said.
"Also there is more of a risk now of China maybe having a bit of a hard landing, U.S. recovery may be slower than people thought and gold is coming in on its own as an insurance policy, safe-haven bid."
European stocks edged up on Monday but still traded near one-month lows, following a fall in Asia, while the dollar firmed against a basket of currencies.
Crimea's Moscow-backed leaders declared a 96-percent vote in favour of quitting Ukraine and annexation by Russia in a referendum that Western powers said was illegal and will bring immediate sanctions.
Traders were now awaiting the U.S. Federal Reserve's policy meeting on March 18-19. The central bank is expected to announce another $10 billion cut to its bond-buying stimulus.
A series of U.S. economic data showing that growth has been hurt by severe cold weather has recently hit the dollar, in turn bolstering gold. A weaker U.S. currency makes dollar-denominated assets like gold cheaper for foreign investors.
"The FOMC March policy statement on Wednesday will steal market's attention, but until then gold will trade on risk sentiment still watching Ukraine," VTB Capital said.
NEW MONEY FLOWS INTO GOLD ETFs
New money has been flowing into gold-backed exchange-traded funds as investors seek safety from riskier assets during times of uncertainty.
Holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 3.29 tonnes to 816.59 tonnes on Friday.
Hedge funds and money managers raised their bullish bets in gold futures and options for a fifth consecutive week to the most bullish stance since mid-December 2012, according to Friday data from the Commodity Futures Trading Commission.
Consumer interest in gold has been waning with the climb towards $1,400 as physical buyers expect prices to fall in the next few months.
Prices in China are at a $6 an ounce discount to spot prices, indicating a sharp drop-off in demand compared with the beginning of the year when prices were at a premium of $20.
"Things have been pretty quiet since the Chinese New Year holiday," said one Hong Kong-based dealer. "People don't want to buy now since they think prices could fall again."
In other precious metals, silver was down 0.1 percent to $21.41 an ounce.
Platinum was up 0.9 percent at $1,475.25 an ounce, while palladium rose 0.9 percent to $773.50 an ounce.