By Sethuraman N R
Spot gold was down 0.4 percent at $1,284.15 per ounce as of 0617 GMT.
U.S. gold futures were 0.6 percent lower at $1,288.80.
U.S. Vice President Mike Pence said on Wednesday that Washington would work with its allies and China to put economic and diplomatic pressure on North Korea but added that America would defeat any attack with an "overwhelming response."
"The whole situation for gold is more than optimistic because of the geopolitical tensions aroused by North Korea and with the interest rate hike expectations coming down," said Mark To, head of research at Hong Kong's Wing Fung Financial Group.
"We see $1,280 as the gravity around which the trading range will be built and prices will move between $1,270-$1,310."
The dollar index edged up, but was hovering near a three-week low on disappointing U.S. housing starts data and nervousness over trade talks between the United States and Japan.
"Gold has been stuck at a high level and seeing a bit of profit-taking... Prices should adjust and rise again," said a Shanghai-based trader.
In France, investors remained nervous ahead of the first round of the country's presidential election this Sunday, even though an opinion poll put centrist Emmanuel Macron first, just ahead of far-right, anti-euro candidate Marine Le Pen.
"Nervousness heading into the French election should theoretically provide some support to gold, but at some point, we think the markets will start to discount a poor showing for Le Pen and perhaps siphon off some of the risk premium already baked into prices," said INTL FCStone analyst Edward Meir.
"However, offsetting this somewhat, is the possibility that the dollar will continue to recede on a Le Pen defeat, coupled with the fact that U.S. tax reform and infrastructure spending both seem to be increasingly far removed, painting a rather bullish backdrop for gold."
British Prime Minister Theresa May's call for a snap general election added to a lengthening list of uncertainties for investors already on edge over geopolitical tensions.
Gold should find support around $1,280 and $1,276 to restrict further downside moves in the short term, while the metal is well positioned to test $1,300 levels as geopolitical concerns underpin its safe-haven status, said MKS PAMP Group trader Sam Laughlin.
Spot silver dropped 0.4 percent to $18.18 per ounce.
Platinum rose 0.3 percent to $976, while palladium was down 0.3 percent at $772.55. Palladium on Tuesday fell nearly 2 percent to a more than four-week low of $769.80.
(Reporting By Nallur Sethuraman in Bengaluru; Editing by Subhranshu Sahu)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)