Gold steadied on Friday, but remained below this week's three-month top as the US dollar and Treasury yields came off their highs after the currency initially jumped on US President Donald Trump's promise of a major tax announcement. Spot gold was up 0.02 percent at $1,230.78 an ounce by 2:24 pm EST (1924 GMT), while US gold futures for April delivery settled down 0.07 percent at $1,235.90. On Wednesday, spot gold reached its highest since mid-November at $1,244.67.
Gold prices were on track for a second weekly gain, up 1 percent from late last Friday. The dollar pared gains against a currency basket on Friday after earlier strength from US President Donald Trump's pledge to announce a major tax plan within weeks cooled some market nerves, reinvigorating dollar bulls.
Wall Street hit record highs for a second day on hopes of the business-friendly tax cuts.
"The dollar puts a little pressure on gold however the strength in the equity markets and the strength in the other precious metals is lifting gold up," said Eli Tesfaye, senior market strategist for brokerage RJO Futures in Chicago, as gold prices moved into positive territory.
"It's really the intermarket relationship that's stabilising gold right now." Silver was up 1.5 percent at $17.91 an ounce, after tapping $17.99, the highest since November 11. Palladium rose 1.6 percent to $782, after rising to $786.40, the highest since January 25. "Both silver and palladium are up on the day as an improving China signals a better global economy and gives support to the more industrial metals of the group," said aid Miguel Perez-Santalla, vice president of Heraeus Metal Management in New York. Earlier in the session, however, gold prices were lower. "The Trumpflation trade is back on the agenda, which is negative for gold," Commerzbank analyst Carsten Fritsch said. Gold is highly sensitive to rising US interest rates, which increase the opportunity cost of holding non-yielding bullion while boosting the dollar, in which it is priced. The major physical markets in Asia were mixed this week as Indian jewellers stocked up for wedding season, while rising prices sidelined buyers elsewhere.
Platinum was down 0.6 percent at $1,006.10.