Gold hits one-week low

Cash gold extended the previous day's steep decline on Friday to a fresh one-week low on a firm dollar and rising US treasury yields, while Tokyo gold futures also fell on stop-loss selling.
The key gold futures for April 2008 delivery on the Tokyo Commodity Exchange sank by their daily 60-yen a gram limit, or 2.3 percent, to 2,592 yen.
The last time a benchmark contract closed limit down was on March 5, when then benchmark February 2008 sank by the daily 90-yen limit to 2,432 yen
"A stock market slide, prompted by a rise in bond yields, and a rise in the dollar versus the euro are all negative for gold," said Tatsuo Kageyama, analyst at Kanetsu Asset Management Co Ltd's research department.
Cash gold was at $658.30/659.00 an ounce, compared with $659.50/660.00 in New York. It earlier fell as low as $657.60.
This week, gold bullion climbed as high as $673.95, the highest since May 14, helped by a fall in the dollar. The dollars edged higher against the euro on Friday after staging a broad-based rally the previous day as rising US government bond yields provided a big potential draw for overseas investors.
The euro stood at $1.3420, extending losses from a three-week high of $1.3555 hit in the week. The recent move by investors to shift funds to riskier assets, including gold, had lost momentum on Thursday, when US Treasury bond yields across the board reached or broke the 5 percent mark the first time the entire yield curve was at or above that threshold since July.
US Treasury yields jumped in the past month as talk of a Federal Reserve rate cut has cooled due to data showing strength in the world's biggest economy.
Also, rising interest rates in Europe has drawn investor interest back towards government bonds, analysts said. Gold bullion has risen less than 4 percent in the year to date and unlike bonds, gold yields zero.
Kanetsu's Kageyama said the TOCOM market was under extra pressure after the late recovery in the previous session turned out to be a disappointment.
On Thursday, the contract closed 4 yen higher at 2,652 yen, near the day's high, as speculative buying emerged in late trade on a fall in the yen from a three-week peak versus the dollar.
A weaker yen inflates yen-based TOCOM prices. The dollar was little changed at 121.10 yen on Friday, clawing back from a three-week low around 120.80 yen marked on Thursday.
TOCOM platinum futures followed falling gold futures lower. Benchmark April platinum futures contract fell 57 yen a gram, or 1.5 percent, to 4,992 yen.
Cash platinum reversed gains to fall to $1,285/1,290 an ounce, compared with $1,287/1,293 in New York.
Spot palladium was at $364/369 an ounce hardly changed from New York. Silver was at $13.41/13.45 an ounce, compared with $13.44/13.47.