Gold steadied on Friday after three days of declines, but was heading for its first weekly drop in three as strength in the dollar and global equities curbed appetite for the safe-haven metal. Bullion climbed to a three-week high on Tuesday but gave up those gains as world stocks rose to their highest levels since late December on Thursday, boosted by robust Chinese economic data and a surge in oil prices earlier this week.
Asian shares and the dollar were subdued on Friday but were still headed for weekly gains. Spot gold edged up 0.3 percent to $1,230.30 an ounce by 0646 GMT, following a drop of 1.3 percent in the previous session. It is down nearly 1 percent for the week. "The rally earlier this week was tied to the strength of Japanese yen and risk aversion. But that has retreated now," said a Hong Kong-based gold trader. Gold's inability to climb to 2016 highs near $1,280 earlier this week shows the metal's rally could be fading, he said.