Numerous studies have addressed the issue of where people look when they perform hand movements. Yet, very little is known about how visuomotor performance is affected by fixation location. Previous studies investigating the accuracy of actions performed in visual periphery have revealed inconsistent results. While movements performed under full visual-feedback (closed-loop) seem to remain surprisingly accurate, open-loop as well as memory-guided movements usually show a distinct bias (i.e. overestimation of target eccentricity) when executed in periphery. In this study, we aimed to investigate whether gaze position affects movements that are performed under full-vision but cannot be corrected based on a direct comparison between the hand and target position. To do so, we employed a classical visuomotor reaching task in which participants were required to move their hand through a gap between two obstacles into a target area. Participants performed the task in four gaze conditions: free-viewing (no restrictions on gaze), central fixation, or fixation on one of the two obstacles. Our findings show that obstacle avoidance behaviour is moderated by fixation position. Specifically, participants tended to select movement paths that veered away from the obstacle fixated indicating that perceptual errors persist in closed-loop vision conditions if they cannot be corrected effectively based on visual feedback. Moreover, measuring the eye-movement in a free-viewing task (Experiment 2), we confirmed that naturally participants’ prefer to move their eyes and hand to the same spatial location.