Gold futures fell on Friday, retreating further from this week's three-month high, as President Donald Trump's promise of a major tax announcement boosted the dollar and upbeat data fueled talk of a near-term rise in U.S. interest rates.
Disappointment among some buyers at gold's failure to break above the $1,245 an ounce level it tested twice this week has also fed into the pullback, analysts said.
Spot gold was up 0.22 percent to $1,233.20 per ounce, while U.S. gold futures for April delivery dropped by 90 cents to settle at $1,235.90. On Wednesday, it touched its highest since Nov. 11 at $1,244.67.
The dollar reached a 10-day high against a basket of currencies on Friday and was on course for its best week since mid-December as Trump's pledge to announce a major tax plan within weeks cooled some market nerves, reinvigorating dollar bulls.
"Obviously the dollar has recovered a bit of strength in the past day or so, which has weighed on precious metals," Mitsubishi analyst Jonathan Butler said.
"The move above $1,220 was pretty convincing, but we didn't get to the next level at $1,249-$1,250, which would have been confirmation of that bullish trend going back to the start of the year. What we've seen is possibly some disappointed investors turning tail and booking some profit."
U.S. economic data also stoked talk that the Federal Reserve would press ahead with U.S. interest rate hikes sooner rather than later. Initial jobless claims dropped unexpectedly last
week to the lowest in nearly 43 years.
Gold is highly sensitive to rising U.S. interest rates, which increase the opportunity cost of holding non-yielding bullion while boosting the dollar, in which it is priced.
Major physical markets in Asia were mixed this week as Indian jewelers stocked up for wedding season while rising prices sidelined buyers elsewhere.
Premiums over the spot price in India rose to $3 an ounce this week from about $2 the previous week, indicating upbeat demand. In Hong Kong and Singapore, they edged down to between 80
cents and $1.20 from about $1-$1.40 last week.
Platinum lost 0.39 percent to $1007.85, having touched its highest since Oct. 3 on Thursday at $1,008.30.
A Commerzbank note on technicals said that the bank was alert to profit-taking after platinum's retest of its $1,025 November high.
"A close above $1,025.51 would target $1,070, the Sept. 22 high, and the 61.8 percent retracement at $1,080," it said.