By Brijesh Patel
(Reuters) - Gold prices traded in a narrow range on Thursday as investors looked to U.S. inflation data and the Federal Reserve's interest rate hike decision next week.
Spot gold was steady at $1,786.39 per ounce at 1304 GMT after rising more than 1% on Wednesday.
U.S. gold futures were little changed at $1,796.90.
"Gold appears to be steadying ahead of the inflation data from the U.S. and, of course, the Fed meeting next week," said Craig Erlam, senior market analyst at OANDA.
"The jobs report was a setback and one that could stand in the way of another break higher before the Fed meeting."
The Federal Open Market Committee policy meeting statement is due on Dec. 14. Traders are pricing in a 93% chance that the U.S. central bank will raise rates by half a point.
However, recent upbeat U.S. employment, services and factory data added to market uncertainty over the Fed policy outlook.
"If the Fed keeps the pace of the rate hike intact - i.e. 75 basis point or more - that may be a negative sign for gold in the short term," said Hareesh V, head of commodity research at Geojit Financial Services in Kochi, India.
High interest rates increase the opportunity cost of holding gold as it yields no interest.
Investors will also be on watch for the U.S. Consumer Price Index (CPI) report for November due on Dec. 13.
The World Gold Council (WGC) said global gold ETFs (exchange traded funds) holdings fell for a seventh straight month in November, although outflows slowed to a modest 34 tonnes worth $1.8 billion. [GOL/ETF]
Spot silver was steady at $22.73 per ounce, platinum eased 0.2% to $1,000.77 and palladium gained 0.8% to $1,859.74.
(Reporting by Brijesh Patel and Ashitha Shivaprasad in Bengaluru; Editing by Angus MacSwan, Kirsten Donovan)