Gold fell on Friday on a firmer dollar after US President Donald Trump promised a major tax announcement and as economic data boosted expectations of a US rate hike. Spot gold was down 0.5 percent at $1,223.93 per ounce by 0711 GMT. On Wednesday, it touched its highest since November 11 at $1,244.67. US gold futures dropped as much as over 1 percent to $1,223.30 an ounce.
"The reversal (in prices) was almost entirely due to the surge in the dollar that took place after President Trump revealed he had a 'phenomenal' tax plan ready for unveiling in a few weeks' time," said INTL FCStone analyst Edward Meir.
Trump plans to announce the most ambitious tax reform plan since the Reagan era in the next few weeks, the White House said on Thursday, sending stock prices and the dollar higher on hopes for a cut in corporate tax rates. "Thursday's trading showed us that (investors) were enamoured more by Trump's general announcement and have not yet bothered to focus on the fine print," Meir said, adding the selloff in gold could be somewhat premature and could reverse course.