Gold remained near a one-week trough on Friday and was expected to end a three-week rally, pressured by renewed expectations for a US rate hike this year despite recent soft economic data.

Bullion has surrendered gains inspired by a weak US employment report last week as Federal Reserve officials suggest a US rate hike in June could still be in play, lifting the dollar to three-week highs versus a basket of major currencies.

Spot gold was steady at $1,194.10 an ounce by 0645 GMT, after hitting a session low of $1,192.30 on Thursday. Bullion is down 1.3 per cent so far this week after pulling back from Monday's seven-week top of $1,224.10.

US gold for June delivery was also little changed at $1,193.90 an ounce.

"What is changing rapidly is people's expectations as the actual rate hike timing approaches," said Mark To, head of research at Hong Kong's Wing Fung Financial Group, who believes the Fed is on track to raise rates in June.

Data on Thursday showed the number of Americans filing new claims for jobless benefits rose less than expected last week and the four-week moving average of claims hit its lowest level since 2000, suggesting an abrupt slowdown in job growth in March was likely a fluke.

Investors tend to shun gold, which doesn't pay interest, when market expectations point to US interest rates rising.

"Whether the Fed raises rates in June or decides to wait till September is a moot point in our view since we think that once the first rate hike takes place, the Fed will likely stand aside for a period of time to see what the repercussions of its move will be," INTL FCStone analyst Edward Meir said in a note.

Gold could drop to a five-year low of $1,100 this year, before a recovery in 2016 spurred by Asian demand, GFMS analysts at Thomson Reuters said.

Demand from India and China, the world's top two gold consumers, has been slack so far this year, with Beijing's anti-corruption drive hurting Chinese appetite.

Gold buying in Asia was slow this week as firmer spot prices turned off buyers, especially in China, and a potentially weak monsoon threatened demand in India.

Premiums for physical gold at the Shanghai Gold Exchange stood at a modest $1-$2 an ounce over the global spot benchmark on Friday.

In India, gold demand risks falling for a second straight year as millions of Indian farmers hit by erratic weather and falling commodity prices trim purchases.

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