Gold sinks on rallying dollar

Gold prices dipped in Asia on Friday, languishing near a one-year low, weighed down by a rally in the U.S. dollar amid heightened global political tensions.

Spot gold shed 0.5% to $1,206.29 U.S. an ounce early Friday morning, hovering close to its one-year low of $1,204 hit last week. The metal was also on track to post a fifth consecutive weekly decline.

U.S. gold futures were 0.5 percent lower at $1,213.40 U.S. an ounce.

The U.S. dollar, in which gold is priced, on Friday extended gains to hit a 13-month high against a basket of peers as European currencies such as the pound and euro continued to lose traction.

Meanwhile, fresh U.S. sanctions against Moscow saw Russia's rouble near a two-year low, while the Turkish lira plumbed a record low in the wake of a diplomatic rift with the United States.

Gold prices, which can gain during times of uncertainty, have largely failed to benefit from rising geopolitical tensions this year, as investors have chosen the safety of the dollar over the precious metal.

Also adding pressure on gold were expectations for higher interest rates in the United States, where the Federal Reserve is expected to raise benchmark lending rates next month for the third time this year.

In other metals, silver fell 0.6% to $15.32 U.S. an ounce. Platinum was down 0.4% at $827.20, while palladium lost nearly 1% at $899.10 U.S.

All three metals were headed for weekly losses.