Gold prices steady but head for first weekly drop of 2017

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Gold was little changed on Friday, giving up earlier losses as U.S. equity markets and Treasury yields turned lower, but the metal was on track for its first weekly loss of the year after traders cashed in on this week's rally to two-month highs.

Spot gold was 0.13 percent higher at $1,190.06 an ounce, while U.S. gold futures for February delivery settled down 0.03 percent at $1,189.40 per ounce.

Gold slides to 2-week low

The dollar was 0.2 percent up against a basket of currencies, hanging on to positive territory despite data showing U.S. economic growth slowed more than expected in the fourth quarter.

That helped to pull gold further down from Tuesday's high of $1,219.59 an ounce and set it on track to end a four-week winning streak with a 1.6 percent weekly loss.

"It turned up because equities went lower," said Bob Haberkorn, senior market strategist for RJO Futures in Chicago.

"I think this could be short-lived. Next week we've got some news from the Fed coming out as well as the January job report (on Friday)."

The U.S. Federal Reserve is scheduled to release a statement on Wednesday after a two-day meeting.

"The dollar is being a big influence on gold right now, so that's what's behind the current move," ING analyst Hamza Khan said. "But overall I think the weeks of gains we've had are more indicative than this pull-back, which might just be due to people locking in some profits and waiting for the Fed meetings before they get long again."

Analysts have scaled back expectations for gold prices this year after the metal's weak fourth-quarter performance, with the prospect of further U.S. interest rate hikes from the Fed weighing on sentiment.

Gold demand in India improved this week, boosted by a fall in prices overseas, though some consumers are waiting in the hope that import duty will be cut in the government's budget next week.

Gold is shining, but not for long: Trader

"Most of Asia is already off for the holidays, which is a good time for many to short the metal," said Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong.

Silver was up 1.69 percent at $17.135 an ounce, while platinum rose 0.42 percent to $985.80.

Palladium was up 2.43 percent to $738.50, having earlier hit its lowest since Jan. 4 at $708.97. The autocatalyst metal is on track to fall 5.8 percent this week, its poorest weekly performance since October.