Gold steady as dollar sags after OPEC deal

Spot gold had risen 0.3 per cent to $1,325 and US gold futures were up 0.4 per cent at $1,328.60

Gold edged up on Thursday as the US dollar weakened in the wake of an oil producer agreement to curb output.

Division between Federal Reserve policymakers on when to raise US interest rates has sapped investor enthusiasm for trading on comments by officials from the central bank.

"The gold and dollar markets are currently without very strong direction. The mixed views from US Fed officials have weakened their credibility and the market has stopped buying (on) their comments," said Jiang Shu, chief analyst at Shandong Gold Group.

"For now, we can see gold move in the band of $1,300 to $1,350."

Spot gold had risen 0.3 per cent to $1,325 an ounce by 0345 GMT. US gold futures were up 0.4 per cent at $1,328.60 an ounce.

The Organization of the Petroleum Exporting Countries on Wednesday agreed modest oil output cuts in the first such deal since 2008, with the group's leader Saudi Arabia softening its stance on arch-rival Iran amid mounting pressure from low crude prices.

Oil futures extended gains on Thursday after rising nearly 6 percent the day before on the surprise OPEC move.

"Further oil price rallies may feed more convincingly into the gold market, especially if other non-oil commodities also rally, and the broader commodity indices, such as the GSCI, rise," HSBC analyst James Steel said in a note.

The gold market will absorb another raft of US., European and Japanese economic data on Thursday, he said. US GDP numbers are due, as well as European Union business confidence data.

"We think prices may stay on the defensive in the absence of new developments, unless oil prices continue to rise enough to lend support to bullion."

The dollar index, which measures the greenback against a basket of currencies, fell as much as 0.1 per cent to 95.338

Silver was up 0.4 percent at $19.24 an ounce. Platinum and palladium rose over 1 per cent to $1,033.99 and $717 respectively. Palladium earlier touched its highest in over seven weeks at $721.30.