Gold erased most of its early gains after touching 6-1/2-month highs on Friday, as Asian equities regained some footing after Beijing announced a new round of trade talks with Washington amid fears of a global economic slowdown.
Spot gold was up 0.1% at $1,294.90 U.S. per ounce after touching $1,298.42 earlier, its highest since mid-June.
U.S. gold futures were up about 0.1% at $1,296.50 U.S. per ounce.
The contract briefly surpassed the psychological $1,300 U.S. per ounce level earlier in the session.
A working team led by Deputy U.S. Trade Representative Jeffrey Gerrish will come to China to have "positive and constructive discussions" with Chinese counterparts, China’s commerce ministry said in a statement on its website.
Investors now will be looking for cues about interest rate hikes from a discussion between U.S. Federal Reserve Chair Jerome Powell and former Fed Chairs Janet Yellen and Ben Bernanke on Friday.
Gold is highly sensitive to rising U.S. interest rates, which lift the opportunity cost of holding non-yielding bullion.
Investors had expected the U.S. Fed to stay on its tightening path after three hikes last year, but the ongoing trade war and recent disappointing corporate earnings have put those expectations to rest.
Meanwhile, markets are awaiting the closely watched December payrolls report later in the day.
Spot gold has risen about 1% so far this week, mainly on safe haven buying spurred by volatility in equity markets and fears of a global economic slowdown, and was on track for its third straight weekly gains.
Among other precious metals, palladium was flat at $1,263.90 U.S., while silver was unchanged at $15.74 per ounce U.S.
Platinum gained about 0.2% to $799.74 U.S.
