Spot gold was up 0.5% at $1,813.50 per ounce by 1305 GMT. U.S. gold futures were up 0.4% to $1,812.10.
The dollar index held close to near three-month lows, raising gold's appeal for other currency holders. Meanwhile, an extension of coronavirus restrictions in Germany and a weak growth forecast for Britain kept European shares flat. [USD/] [.EU]
Trading was expected to be thinned by the U.S. Thanksgiving holiday.
"We've had a relatively soft dollar and it hasn't given that much of a lift to gold during the decline. Now it's giving a little bit of a tailwind, giving it a lift back towards $1,860," said independent analyst Ross Norman.
"(Gold) has found its floor and there's some evidence of good buying at these lower levels. The lower price has stimulated good physical buying in the (Asian) markets."
U.S. Federal Reserve policymakers discussed how the central bank's asset purchases could be adjusted to provide more support for markets, according to the minutes of its Nov. 4-5 meeting.
Gold is considered a hedge against inflation likely to result from large stimulus.
"Persistently high numbers of new corona cases and extended lockdowns in many countries are increasing the need for further support in the form of monetary and fiscal policy. A vaccine will offer no quick-fix in that sense," said Commerzbank analyst Carsten Fritsch in a note.
"New stimulus measures are therefore likely to be set in motion in the near future, which should benefit gold. In this environment, gold is initially likely to trend sideways in a corridor of between $1,800 and $1,850."
Silver was up 0.3% to $23.37 an ounce, palladium rose 1.4% to $2,361.51, while platinum fell 0.4% to $959.62.
(Reporting by Asha Sistla in Bengaluru; editing by Barbara Lewis and Pravin Char)
By Asha Sistla
