Gold on track for second weekly loss

Gold on Friday headed for its second straight weekly loss, pulled lower by a firmer dollar and rising oil prices that kept inflation concerns in focus and increased bets for a US interest rate hike, reports Reuters.

Spot gold fell 0.5 per cent to $4,519.69 per ounce, by 1255 GMT. It is down 0.4 per cent so far in the week. US gold futures for June delivery lost 0.5 per cent to $4,520.90.

"Gold is still very much on the defensive. Critically, it's still holding support at $4,500 on a technical basis so that's keeping the downside somewhat in check.

The upside is limited, though, with the stronger dollar and rising oil capping gains," said Edward Meir, an analyst at Marex.

Oil prices climbed as investors doubted US-Iran peace talks would yield any breakthrough. The dollar held near a six-week high, making dollar-priced bullion more expensive for holders of other currencies.

High energy prices tend to drive up inflation and could prompt central banks to keep interest rates higher for longer, which weakens demand for non-yielding bullion, even though it can be an inflation hedge.

Traders have priced in a 58 per cent chance of at least one 25 basis-point US Federal Reserve interest rate hike by December, according to CME Group's FedWatch tool.