Gold edged higher on Friday in response to a weaker dollar but remained on track for its sharpest weekly drop in more than two months as strong U.S. economic data raised uncertainty over the timing of a slowdown in stimulus measures.
Spot gold was last up up 0.2 percent to $1,245 an ounce, after hitting a fresh 4.5-month low of $1,236.29 in the previous session.
U.S. gold futures for December delivery were flat at $1,243 an ounce.
Gold was on track for a 3.4 percent weekly drop, while spot silver also headed for its worst week since mid-September, down 3.7 percent so far.
"The gold price drop seen earlier this week has weakened the technical picture and the next important level to watch is obviously $1,200,'' said Bernard Dahdah, precious metals analyst at Natixis.