Gold prices traded in a narrow range on Friday, below the previous session's high, as the dollar steadied amid caution ahead of US jobs data later in the day.

Spot gold was mostly unchanged at $1,275.82 per ounce at 0657 GMT, and was on track for its first weekly gain in three. It hit its highest in about two weeks at $1,284.10 in the previous session. US gold for December delivery dipped 0.1 percent to $1,276.50.

US jobs data

The dollar held steady versus a basket of currencies on Friday, as the focus shifted to US jobs data, with President Donald Trump's nomination of Federal Reserve Governor Jerome Powell to be the next Fed chair coming as no surprise.

The greenback had slipped on Thursday after Republicans in the US House of Representatives released proposals to overhaul the tax code.

Asian share markets edged higher on Friday as investors gave a guarded reception to the plans for massive US tax cuts, while welcoming the appointment of a centrist at the helm of the Fed.

A holiday in Japan kept volumes light, while investors observed the usual caution ahead of the US payrolls report which is expected to show a big bounce back from September's hurricane-hit result.

“Gold seems to be broadly flat. The announcement of Jerome Powell as the new Fed Chair was broadly in line with expectations,” said John Sharma, an economist with National Australia Bank.

“Markets are waiting for the US payrolls data. A strong result here would not be supportive of gold.”

Trump's appointment of Powell broke with precedent by denying Janet Yellen a second term but signalling a continuation of her cautious monetary policies.

Spot gold looks neutral in a narrow range of $1,263-$1,281 per ounce, and an escape could suggest a direction, according to Reuters technical analyst Wang Tao.

“If the market somehow believes that Powell will not be aggressive in raising interest rates next year, then gold might have possibly bottomed at $1,260 already,” said Samson Li, an analyst with Thomson Reuters GFMS.

Gold is highly sensitive to rising US interest rates, which increase the opportunity cost of holding non-yielding bullion, while boosting the dollar, in which it is priced.

Meanwhile, holdings of the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.4 per cent to 846.04 tonnes on Thursday.

In other precious metals, spot silver inched up 0.2 percent to $17.11 an ounce, platinum eased 0.4 per cent, to $921.50 and palladium was up 0.3 per cent to $999.33.

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