Gold held steady on Friday amid tumbling equity markets, but a firmer dollar and worries about rising global interest rates weighed on prices. Spot gold was mostly unchanged at $1,319 an ounce, at 0715 GMT. Prices touched their lowest since January 4 at $1,306.81 on Thursday.
Spot gold was down 1 percent for the week and headed for its second straight weekly drop due to a recovery in the dollar. US gold futures were up 0.1 percent at $1,320.50 per ounce. "Gold has got some support from safe-haven demand as people are buying to hedge their portfolio against market volatility," said Helen Lau, analyst at Argonaut Securities.
"The threat of rising interest rates will have some downside pressure on gold However, in the near-term gold will gain due to volatile markets." The Bank of England said on Thursday it was likely to raise interest rates sooner and by more than it thought only three months ago, because Britain's slow-moving economy is getting a boost from the global recovery.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.07 percent to 826.31 tonnes on Thursday from Wednesday. Holdings fell over the last three sessions, and have declined 1.7 percent so far this week, the worst since the week ended July 30, 2017.
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