Gold prices slipped on Friday, after a rally following positive economic data from China faltered on dour U.S. consumer data.
U.S. gold futures ended the U.S. session at $1,687, down $3.80 as stocks gave up some of its early gains. U.S figures showed consumer sentiment at its lowest level in over a year in January.
Platinum and palladium declined as players exited positions following recent gains.
Spot gold was above $1,686 an ounce, heading for a weekly rise of 1.4 percent, its biggest in nearly two months. It hit a one-month high of $1,695.56 on Thursday.
The metal was also lifted by renewed physical demand in China ahead of the New Year in February and after better-than-expected Chinese GDP data.
China's economy grew at a slightly faster-than-expected 7.9 percent in the fourth quarter of 2012, which combined with Thursday's positive U.S. data, sent world stocks to hit 20-month highs earlier.
"For gold we had some good physical demand from Asia, particularly China, after better-than-expected GDP data," HSBC analyst Howard Wen said. "We expect physical buying to pick up ahead of the Chinese New Year on Feb. 10."
Positive physical demand was also seen elsewhere, with the swap rate for delivery in Zurich versus London firmly in positive territory, suggesting strong physical offtake and subdued scrap supply, broker UBS said in a note.
Prices were hovering just below their 50-day moving average at $1,696, which represents a technical resistance level along with the psychological mark of $1,700, according to analysts who study past price patterns to determine the future direction of trade.
"There is some technical resistance at that $1,700 level, and gold has to break above that to move higher," HSBC's Wen said.
In the longer term, expectations that the U.S. Federal Reserve would continue its monetary stimulus and concerns about U.S. fiscal conditions will keep gold attractive as a hedge against inflation and uncertainty, market participants said.
Platinum and palladium were down following their rally to multi-month highs earlier this week.Spot platinum fell 1.5 percent trade below $1,665 an ounce but was still on course to rise for a third week, by 2.3 percent.
Spot palladium fell more than a percent to trade just below $714 an ounce, having earlier hit a 16-month high of $730.47.
Platinum group metals were underpinned by threats to South African supply and by the positive Chinese GDP data, which supported expectations that demand from carmakers, the biggest consumers of the platinum group metals, will improve.
Platinum hit a three-month high at $1,701.50 on Thursday after rising throughout the week on supply concerns from leading producer South Africa, where number one platinum miner Anglo American Platinum announced cutbacks.
"The market seems to have discounted the impact of the Amplats' announcement," MKS Finance Vice president Bernard Sin said.
Trading in the two metals was also affected by high levels in Comex long positions.
"Comex positions for PGMs are at record levels, and it's a question of how much longer they can go, and that's one of the main reasons why the metals are down today," HSBC's Wen said.
Spot silver rose to a one-month high of $32.11, on course for a 4.5 percent weekly gain. It was last seen at $31.76, up 0.1 percent.
The U.S. Mint suspended sales of its 2013 American Eagle silver bullion coins after running out of stock due to soaring investor demand for the newly minted coins in the first two weeks of the year until the week of Jan. 28.