Palladium was on track to end the quarter about 9 percent higher, having surged to an all-time high last week on a sustained supply crunch. Bullion was also set for its second straight quarterly rise, helped mainly by a dovish U.S. Federal Reserve and concerns about the global economy.
Spot gold rose 0.5 percent to $1,297.36 per ounce. It declined on Thursday by about 1.5 percent, the most in more than seven months and breaking below key support around $1,300.
Gold was also headed for a second consecutive monthly fall, losing about 1.5 percent.
U.S. gold futures were up 0.6 percent on the day, at $1,302.60 an ounce.
“We may have had some physical buyers coming in the market. The price fall was fairly steep and when prices fall that quickly, (most) buyers tend to stay out of the market,” said Philip Newman, a director at Metals Focus.
The dollar hovered near its highest in more than two weeks hit in the previous session, while stock markets advanced on hopes of progress in trade talks between Beijing and Washington.
Meanwhile, spot palladium rose from two-month lows touched in the last session, gaining about 2 percent to $1,374.61 an ounce.
“It’s just some buyers coming in and thinking that these prices are of fair value and this is the opportunity to come into the market. They might have thought the declines yesterday were overdone and now is a good time to come in and build some positions modestly,” Newman said.
The metal, used to make catalytic converters for vehicle exhaust systems, had soared since last year on a sustained deficit.
The run stalled this week, with the metal sliding the most since January 2017 on Thursday, which analysts attributed to a possible drop in demand due to a weaker global economy.
“When you have an exponential price rise, at some point you will come back to fundamentals,” ABN AMRO analyst Georgette Boele said.
“Fundamentals like car sales in China and the rest of the world are not as strong as expected.”
Silver was up 0.7 percent at $15.12 an ounce, after hitting its lowest since late December at $14.94, while platinum rose about 1.9 percent to $853.15.