Gold prices bounced on Friday, erasing earlier losses as the dollar and U.S. Treasury yields fell, but was still on track for a seventh weekly drop in eight as investors positioned themselves for a likely U.S. rate rise next week.
A rate increase at the Federal Reserve's policy meeting on Dec. 15-16 would be the first in nearly a decade and could dent demand for non-interest paying gold.
"Temporary short squeezes could disturb the long-term downward trend but we still expect prices around $1,000 next week," ABN Amro analyst Georgette Boele said.
Spot gold, lower initially, was up 0.4 percent to $1,075.84 an ounce. It was on track for a 0.7 percent decline for the week.