Gold slips as ECB gives no stimulus cue

Gold dipped on Friday after the European Central Bank stopped short of offering any concrete signals on further stimulus, but lingering economic uncertainties kept the metal on track for a weekly rise.

Spot gold was down 0.5% at $1,945.18 per ounce by 1040 GMT, after hitting its highest level since Sept. 2 at $1,965.94 on Thursday. Gold has gained 0.7% this week.

US gold futures fell 0.6% to $1,953.40.

"The ECB did not address the stronger Euro, neither did it come up with any stimulus plans, which will keep inflation in check in the Euro zone. That's negative for gold," said Quantitative Commodity Research analyst Peter Fertig.

European Central Bank President Christine Lagarde played down concerns about the euro's strength and disappointed hopes for more stimulus.

Investors will now focus on the US inflation data due later in the day for further clarity on global economic recovery.

The US Senate blocked a Republican bill that would have provided around $300 billion in new coronavirus aid.

Gold is perceived as a hedge against inflation and currency debasement.

"While COVID-19 vaccine developments and improving economic data present near-term headwinds to gold, low and negative interest rates, a weaker USD, and expectations for further stimulus keep the balance of risks to the upside," Standard Chartered said in a note.

Recent data showed, Britain's economy grew for a third month in a row in July as some sectors reopened after the coronavirus lockdown, but it remained around 12% smaller than its pre-pandemic level.

Elsewhere, silver dropped 0.2% to $26.86 per ounce, while palladium rose 0.3% to $2,300.60.

Platinum was up 0.5% to $930.42 and was heading for its best week since the week ending Aug. 7, up 3.9%.