Gold edged lower on Friday after stronger-than-expected U.S. economic data reduced expectations for further easing this year, bolstering the dollar ahead of a key inflation report due later in the day.
Spot gold was down 0.1% at $3,745.67 per ounce, as of 0409 GMT, but up 1.6% so far this week.
U.S. gold futures for December delivery were steady at $3,774.80.
The U.S. dollar index, opens new tab hovered near a three-week high, and was headed for a weekly gain, making greenback-priced bullion more expensive for overseas buyers.
"The dollar's return to form stands as a potential obstacle between gold and its aspirations for the $3,800 level," said KCM Trade Chief Market Analyst Tim Waterer, adding that U.S. President Donald Trump's latest tariff announcement could limit any immediate downside for bullion.
On Thursday, Trump announced a fresh round of punishing tariffs on a broad range of imported goods starting October 1.
Meanwhile, data released on Thursday showed that weekly U.S. jobless claims declined, while the economy grew faster than estimated in the second quarter on strong consumer spending and business investment.
All eyes are now on the personal consumption expenditures (PCE) price index data, the Fed's preferred inflation measure, due at 1230 GMT.
The report is expected to show a 0.3% month-on-month rise and a 2.7% year-on-year jump in August, per a Reuters poll.
"Gold is trading in somewhat sluggish fashion, with traders reluctant to get on board with any real conviction in case the core PCE data even vaguely mirrors the jump higher in GDP print," Waterer said.
Meanwhile, Federal Reserve policymaker Stephen Miran advocated for aggressive rate cuts to shield the labour market, downplaying inflation risks from tariffs.
Safe-haven bullion tends to perform well in a low interest rate environment.
Spot silver fell 1% to $44.89 per ounce, platinum jumped 0.9% to $1,542.90 to hover near a 12-year high, and palladium gained 0.9% to $1,261.03. All three metals were headed for weekly gains.
Source: Reuters
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