Gold was up US$3.37 per ounce at US$1,696.41 by 0355 GMT, having climbed to US$1,698.45 on Tuesday
Gold tracked the euro higher on Thursday, staying within sight of its highest in nearly six months ahead of a meeting of the European Central Bank later in the day that could bring the announcement of new policies to help contain the euro zone's debt crisis.
But many investors are likely to turn their attention to US non-farm payrolls data due out on Friday, with a weaker-than-expected number likely to bolster expectations of more quantitative easing by the Federal Reserve, probably later this month.
Gold was up US$3.37 per ounce at US$1,696.41 by 0355 GMT, having climbed to US$1,698.45 on Tuesday, the strongest since March. Fed Chairman Ben Bernanke's comment on the grave condition of the US labour market last week had prompted investors to buy the metal as a hedge against inflation.
"I think [the ECB] is going to buy sovereign bonds. But the market is a bit overbought already. Everyone is betting the QE3 is coming. I think the downside is limited even though a correction is coming," said Ronald Leung, director of Lee Cheong Gold Dealers in Hong Kong.
"It's all very quiet in the physical market," said Leung, adding that gold was likely to find support at US$1,670 to US$1,680.
US gold futures for December added US$5 per ounce to US$1,699.00.
Other precious metals also firmed, with silver and platinum rising to the strongest levels since April.
Shares rose in Asia on Thursday and the euro edged back towards the previous session's high on reports that the ECB would buy unlimited amounts of short-term sovereign bonds to cap surging borrowing costs in indebted euro zone states.
Gold, typically a safe-haven asset, has often tracked the fortunes of the euro and stocks, with speculators selling the metal for cash to cover losses in other markets as the euro zone debt crisis caused much turbulence in financial markets.
Sources told Reuters that the ECB was ready to waive seniority status on government bonds it buys under a new programme, which it is set to agree upon at Thursday's Governing Council meeting.
Bullion has risen on talk that the ECB will launch a programme of purchasing Italian and Spanish bonds, with other steps aimed at lowering borrowing costs for debt-saddled countries.
Thin trading suggested that some gold investors had expected the ECB to announce the new buying programme, while selling persisted in the physical market ahead of the payrolls data and as bullion prices held near highs.
The first two rounds of U.S. quantitative easing have lifted gold prices, which have doubled in the last four years. The Fed's next policy meeting is scheduled for next week, but the U.S. jobs report on Friday could affect the decision.
"Physical selling is still there, and Thailand is the most active seller," said a physical dealer in Singapore. "We are also seeing gold bars coming from Indonesia."