Gold prices gain as dollar eases against yen

Gold prices rose on Thursday, recovering from the previous session's fall, as the U.S. dollar edged lower against the Japanese yen.

Spot gold was up 0.3 percent at $1,218.86 an ounce at 0300 GMT, after losing 0.65 percent in the previous session.

U.S. gold futures were nearly unchanged at $1,227.30 an ounce.

"I think people are just watching the dollar. The dollar-yen is down and gold is up," said Yuichi Ikemizu, Tokyo branch manager, ICBC Standard Bank said, adding that the latest headlines on the trade war front between the United States and China had likely induced some buying.

The dollar was down 0.1 percent at 111.62 yen early Thursday. The greenback was, however, supported against major peers after the Federal Reserve kept interest rates steady and gave an upbeat assessment of the world's biggest economy, keeping it on course to increase borrowing costs in September.

A weaker dollar makes greenback-denominated gold cheaper for holders of other currencies while higher interest rates typically pressure gold by increasing the opportunity cost of holding non-yielding bullion.

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