Gold ticked up in thin post-Christmas trading on Friday, but the metal was headed for a second straight weekly drop as strength in the dollar and equities hurt the safe-haven bids for bullion.
Spot gold gained 0.3 per cent to $1,177.31 an ounce by 0020 GMT, not too from a three-week low of $1,170.17 hit earlier in the week.
The metal has lost about 1.5 per cent for the week.
Bullion lost ground this week after data showed the US economy grew in the third quarter at its quickest pace in 11 years. Other data showed initial claims for state unemployment benefits dropped for the fourth straight week, in further signs of a robust economy.
Strong data decreases gold’s appeal as a safe-haven asset.
The data boosted the dollar on expectations that the strong economy would prompt the Federal Reserve to increase the rates sooner than later.
Strong dollar
A strong dollar makes gold more expensive for holders of other currencies. An increase in rates is also seen to dampen the demand for non-interest-bearing bullion.
The dollar index, which tracks the greenback against a basket of six major rivals, was close to a nine-year peak hit earlier in the week.
In other industry news, Deutsche Bank is open to offers for its London-based gold vault following the closure of its physical precious metals business, three sources familiar with the matter said on Wednesday.
Among other precious metals, silver and platinum were headed for their second straight weekly declines, while palladium was on track for a weekly gain.