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Gold recouped early losses on Monday to trade largely steady, helped by a slightly softer dollar, while investors looked for progress on the stalled peace talks between the United States and Iran.

Spot gold was steady at $4,707.75 per ounce, as of 0233 GMT, after shedding 0.8% earlier in the session. Last week, the metal fell 2.5% to snap a four-week winning streak.

U.S. gold futures for June delivery fell 0.4% to $4,720.50.

Lending support to bullion, the dollar eased after a report said that Iran through Pakistani mediators gave the U.S. a new proposal on reopening the Strait of Hormuz and ending the war.

"We're just sort of watching now whether there's progress in the (U.S.-Iran) talks at all in the coming days and that's going to be the biggest driver for gold," said Kyle Rodda, a senior financial market analyst at Capital.com.

U.S. President Donald Trump said on Sunday that Iran could telephone if it wants to negotiate an end to their two-month war and stressed it can never have a nuclear weapon.

Trump cancelled a trip by two U.S. envoys to Iran war mediator Pakistan on Saturday, dealing a setback to peace prospects.

Oil prices rose as the stalled peace talks prolonged the disruption of Middle East energy exports.[O/R]

Higher crude oil prices can stoke inflation by raising transportation and production costs, increasing the likelihood of higher interest rates.

While gold is considered an inflation hedge, high interest rates make yield-bearing assets more attractive, weighing on its appeal.

Investors now await the U.S. Federal Reserve's interest rate decision on Wednesday.

"It could either be a support to gold or an increased headwind, depending on if the Fed sort of indicates whether it sees itself potentially keeping policy unchanged for the rest of the year because of the inflationary impacts of the energy crisis," said Rodda.

Spot silver fell 0.3% to $75.44 per ounce, platinum gained 0.1% to $2,013.15 and palladium was down 0.6% at $1,487.45.