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Gold prices rose on Monday as losses in the US dollar bolstered, though gains were muted as financial markets bet that air strikes on Syria would not escalate into a wider conflict.

Prices have trended sideways since January, buoyed by geopolitical worries but capped by expectations for further US interest rate hikes and strong technical resistance at $US1,360-$US1,365 an ounce – their January, February and April highs.

Spot gold was up 0.10 per cent at $US1,346.31 per ounce, up 0.1 per cent, as US gold futures for June delivery settled up 0.21 per cent at $US1,350.70 per ounce.

Forces from the United States, Britain and France targeted Syria with air strikes on Saturday, hitting what they said were three of its main chemical weapons facilities.

Gold prices reached a high of $US1,350.52 on the back of the news, but struggled to maintain those gains amid expectations the attacks would not mark the start of greater Western involvement in the conflict.

‘Some of the risk (premium) has come down following the air strikes,’ Capital Economics analyst Simona Gambarini said. ‘Some market participants were thinking that maybe there could be an escalation of the tensions, but that has not happened and therefore prices have come down a bit.’

Bullion found support as the dollar sank against the euro.

‘Syria, China trade tensions, and the dollar index falling off are all good reasons for gold prices to continue to rise,’ said senior market strategist at RJO Futures in Chicago. ‘It’s disappointing there wasn’t more of a rally, but traders are turning to equities at these levels.’

Speculators raised their net long positions in COMEX gold contracts by 363 contracts to 138,212 contracts in the week to April 10, US Commodity Futures Trading Commission (CFTC) data showed on Friday.

Palladium rose 1.54 per cent at $US1,002.22 an ounce, off highs of $US1,012.10, the strongest since March 1. Platinum was 0.15 per cent higher at $US928.90.

‘Palladium is shooting up because of Russian sanctions,’ said George Gero, managing director of RBC Wealth Management.