By Vijaykumar Vedala
(Reuters) - Gold inched down to a one-week low on Thursday, pressured by upbeat U.S. growth data and Federal Reserve chair Janet Yellen's bullish view of the economy, but the yellow metal was on track for its first monthly gain since August.
A lack of clear drivers has kept gold between $1,265 and $1,300 an ounce throughout November, its narrowest monthly range in 12 years.
Despite the volatility overnight, it was another subdued session across the precious complex today in Asia, with gold struggling above $1,285 an ounce consistently, MKS analyst Alex Thorndike said in a note.
Spot gold was down 0.1 percent at $1,281.92 an ounce at 0813 GMT, having touched its lowest since Nov. 22 at $1,281.31 earlier in the session. However, the metal has risen 0.9 percent for the month so far.
U.S. gold futures were down 0.1 percent at $1,281.20.
"We see gold prices remaining subdued over the next two months but after that it will start to rise," said Richard Xu, a fund manager at China's biggest gold exchange-traded fund, HuaAn Gold.
"It would be flat for a few days because the economy is great and the financial markets are in sync with inflation."
The U.S. economy has gathered steam this year and will warrant continued interest rate increases amid a strengthened global recovery, Yellen told Congressional leaders on Wednesday in her final scheduled testimony on Capitol Hill.
Higher U.S. interest rates would keep pressure on gold prices as investors seek returns in assets other than non-interest bearing bullion.
Data showed the U.S. economy grew faster than initially thought in the third quarter, notching its quickest pace in three years.
Spot gold may break a support at $1,281 per ounce and fall more towards the next support at $1,277, according to Reuters technical analyst Wang Tao.
"While we remain cautious on it (gold prices) over three months, we regard setbacks as opportunities to add exposure," UBS analysts said in a note, while raising their 12-month forecast from $1,250 an ounce to $1,325 an ounce.
"In the past, early stages of monetary policy normalization hurt gold; but this time such adjustments resemble baby steps and likely will only be undertaken in sync with rising inflation," they said.
In other markets, the dollar index, which gauges the greenback against a basket of six major rivals, was up 0.1 percent as investors kept an eye on the progress of the U.S. tax reform legislation that could see a likely decisive vote later this week.
Silver touched an eight-week low of $16.47 an ounce and was last down 0.1 percent at $16.51.
Palladium gained 0.4 percent at $1,017.0 an ounce, while platinum rose 0.7 percent at $943.30.
In November, palladium has gained nearly 4 percent and platinum 3 percent, while silver is down over 1 percent.
(Reporting by Vijaykumar Vedala in Bengaluru; Editing by Christian Schmollinger and Vyas Mohan)
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