Spot gold firmed on Friday but was still set to finish the week trapped near its cheapest in more than five years as the metal struggles against a stronger dollar ahead of a widely expected US rate rise next month. "We're still negative and target $985 in the short run," said analyst Dominic Schnider of UBS Wealth Management in Hong Kong. "The rationale is fairly clear. The Fed is going to hike, the dollar is going to see further strength and in that environment it's going to be fairly difficult to sustain current prices."
A stronger dollar hurts demand for commodities priced in the greenback by making them costly for holders of other currencies. Spot gold had edged up by 0.4 percent to $1,085.80 an ounce by 0609 GMT. Prices hit the weakest in more than five years at $1,064.95 an ounce on Wednesday and are set to close the week little changed. US gold rose 0.7 percent to $1,086 an ounce.
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