Gold forged higher on Friday in thin pre-Christmas trade as the U.S. dollar retreated from this week's 14-year high, enticing some buyers to take advantage of near-10-month lows in prices after six straight weeks of decline.
Gold has tumbled more than $200 U.S. an ounce from its peak hit in the immediate aftermath of Donald Trump's U.S. presidential election victory on Nov. 8, as his win sparked a greenback rally and drove U.S. Treasury yields higher.
The precious metal is down 14% this quarter, paring its gain for the year to 6.7%, having posted its biggest quarterly increase in 30 years between January and March.
Spot gold was up 0.1% Friday morning at $1,130.63 U.S. an ounce, off last week's low of $1,122.35, while U.S. gold futures for February delivery were also up 0.1% an ounce at $1,132.10 U.S.
The dollar is just over 0.5% off highs hit after this month's Federal Reserve policy meeting, at which the bank surprised markets by indicating interest rates could rise more quickly than expected next year.
Gold is highly sensitive to rising U.S. interest rates, as these increase the opportunity cost of holding non-yielding bullion, while boosting the dollar, in which it is priced.
Among other metals, silver was little changed at $15.77 U.S., while platinum was 0.5% higher at $906.50 U.S. an ounce and palladium was up 0.3% at $657.10 U.S.
