Gold holds on to overnight gains on Wednesday on a softer dollar

Spot gold edged up 0.1 percent to $1,076.16 an ounce by 0034 GMT, following a 0.6 percent gain on Tuesday. U.S. gold had also gained nearly 1 percent in the previous session.

Bullion benefited from safe-haven bids after Turkey shot down a Russian warplane near the Syrian border on Tuesday, saying the jet had violated its air space, in one of the most serious publicly acknowledged clashes between a NATO member country and Russia for half a century.

U.S. President Barack Obama and French President Francois Hollande, meeting in Washington, urged against an escalation, while NATO Secretary-General Jens Stoltenberg said the military alliance stood in solidarity with Turkey. 

The tensions prompted a dip in equities and the dollar, while boosting safe-haven yen, gold and government debt. 

The Tuesday gains should provide short-term relief to gold prices, which last week had fallen to $1,064.95, the lowest since February 2010.

The metal has been under pressure on increasing expectations that the Fed would raise U.S. interest rates for the first time in nearly a decade in December. 

Gold tends to benefit from ultra-low U.S. rates, which cut the opportunity cost of holding non-yielding bullion.