Spot gold was steady at $1,292.51 per ounce, while US gold futures dipped 0.1 percent to $1,292.40 per ounce. "Congressional pushback on efforts to ease US sanctions against Russian metals producers, the world's top source for palladium, have probably helped drive supply shortage worries," said Ilya Spivak, senior currency strategist with DailyFx.
The price of palladium, used mainly in emissions-reducing catalysts for vehicles, has leapt more than 60 percent since a trough in mid-August. Prices for the metal overtook gold for the first time in 16 years late last year. Many members of Congress have been questioning the US Treasury Department's decision in December to ease sanctions imposed in April on certain Russian companies.
A firmer US dollar meanwhile kept a cap on gold. "The dollar is quite strong and acting as a resistance for a breakout in gold," Argonaut Securities analyst Helen Lau said. Gold has gained for five straight weeks, but prices have been hovering around a $20 range for the past two weeks and have been unable to break through a strong technical resistance at $1,300.
"Gold's recent standstill seems to reflect the clouded US growth outlook, and uncertainty about the path forward for Fed monetary policy," said Spivak of DailyFx. Spot gold is about to exit a neutral range of $1,285-$1,299, and either rise to $1,311 or drop towards $1,268, according to Reuters technical analyst Wang Tao.