Gold rose toward $1,140 (U.S.) an ounce Friday, ending the week about $20 higher as a sovereign debt crisis in Greece spurred buying of the metal as a hedge against currency volatility.
Palladium rose to its highest in more than two years, boosted by optimism about global auto catalyst demand and possible near-term tightness in the physical markets, analysts said.
Gold's ability to post gains in the face of a firm dollar indicated the inverse relationship between the greenback and the metal could further weaken, said Tom Hartmann, analyst at California-based broker-dealer Altavest.
"With everything that is going on in Europe, people are losing trust in different types of paper currencies," and that should benefit gold, Mr. Hartmann said.
Gold has traditionally been used as a safe haven in times of economic and political uncertainty, as the metal's intrinsic value is not dependent on any fiat currency.
Spot gold was at $1,132.85 an ounce at 2:27 p.m. ET , against $1,131.45 late in New York on Thursday.
U.S. gold futures for April delivery on the Comex division of the New York Mercantile Exchange settled up $2.10 at $1,135.20 an ounce.
The February non-farm payrolls report showed that U.S. employers cut fewer jobs than expected during the month, and the unemployment rate held steady at 9.7 per cent, bolstering views the economy was on the brink of creating jobs.
The dollar initially rallied on the news due to economic optimism, but the euro later rebounded, supporting gold.
Concern over the fiscal health of peripheral euro zone economies such as Greece, Italy and Spain have weighed heavily on the euro this year. It is currently down nearly 5 per cent versus the dollar in 2010.
Uncertainty over what the next British election may mean for U.K. debt has also heightened volatility in the European currencies, lifting interest in gold as an alternative asset.
Gold priced in euro and sterling terms are hovering near record highs reached earlier this week.
"The shift in sovereign risk away from Greece on Friday has helped support gold, and risk appetite is higher because of the better-than-expected job number," said James Steel, chief commodities analyst at HSBC.
A Wall Street rally and oil's sharp gains amid better economic sentiment also boosted gold's inflation hedge appeal.
Among other precious metals, palladium hit a high of $475.50, the loftiest level since June, 2008. It was last at $475 against $458.50.
"The market is very enthusiastic about the prospect of gasoline-driven vehicles, and there is some near-term physical tightness, which is supporting the market," Mr. Steel said.
Platinum group metals are used in catalytic converters to clean auto exhaust fumes. Gasoline-powered vehicles use a greater percentage of palladium and less platinum than diesel engines, which require more platinum and less palladium.
Steady increase in the holdings of U.S. palladium and platinum exchange-traded funds also underscored strong investment demand. As of Thursday, ETFS physical palladium shares held about 470,000 ounces, and ETFS physical platinum had about 270,000 ounces.
Palladium has outperformed other precious metals this year, rising 17 per cent compared with a 7.5 per cent rise for platinum, 3.3 per cent for gold and 2.7 per cent for silver.
Silver was at $17.30 an ounce against $17.10, tracking gains in gold. Platinum was at $1,574.50 an ounce against $1,576.50.