Gold prices fell for a second day early on Friday as a stronger appetite for riskier assets such as equities and an improving economic outlook diminished safe-haven buying, more than offsetting a weaker dollar. Bullion notched a third consecutive weekly loss, its longest since July, which called into question the metal's lengthy bull run due to signs that the economic recovery is taking hold and as fears about an European debt crisis have subsided for now.
Spot gold fell 0.2 percent to $1,343 an ounce by 2 pm EST (1900 GMT). US gold futures for February delivery settled down $5.50 at $1,341 an ounce. Bullion hit a low of $1,337.50, their weakest price since November 18, as financial markets opened in New York. US traders cited an increase in margin requirements for precious metals futures as a reason for the decline.
Silver inched up 0.2 percent to $27.53 an ounce. The gold-to-silver ratio - the number of ounces of silver needed to buy an ounce of gold - rose back towards 50, its highest level since late November, as some traders believed gold is becoming increasingly expensive relative to silver.
Friday's turnover was modest as COMEX gold and silver futures volumes on the New York Mercantile Exchange were largely in line with their 30-day averages. Analysts say outflows of money from products such as physically backed exchange-traded funds suggest investor appetite for gold is slackening after a run of firmer-than-expected US economic data and as concerns over euro zone sovereign debt levels recede.
Silver prices had earlier hit a seven-week low at $27.10 an ounce, pressured by a further outflows from the world's largest silver-backed exchange-traded fund, the iShares Silver Trust. Platinum rose 0.8 percent to $1,822.24 an ounce against $1,808.50 on Thursday, while palladium climbed 1.4 percent to $819.50.