Gold declines on thin trading, stronger dollar

NEW DELHI, Feb 16 (Reuters): Gold prices fell on Monday, weighed down by low liquidity as key markets in the US and Asia were shut for holidays, while a firm dollar added further pressure on bullion.

Spot gold fell 0.7 per cent to $5,007.70 per ounce by 0858 GMT, after losing more than 1 per cent earlier in the session.

US gold futures for April delivery lost 0.4 per cent to $5,027.90 per ounce.

"Gold is range-trading around $5,000/oz in a week with lower liquidity due to holidays," said UBS analyst Giovanni Staunovo. US markets were closed for Presidents' Day, while markets in China and several other countries in Asia were closed for the Lunar New Year.

The US dollar edged up, making greenback-priced bullion more expensive for holders of other currencies.

Recent US economic data painted a mixed picture for Federal Reserve interest rate cuts, as US consumer prices increased less than expected in January, while job growth unexpectedly accelerated in the same month.

Federal Reserve Bank of Chicago President Austan Goolsbee said on Friday that interest rates could go down, but noted that services inflation remained high.