Gold prices slipped on Friday, set for their biggest weekly fall since June 2021, as demand for greenback-priced bullion weakened after the U.S. dollar scaled to a 20-year peak.
Spot gold was down 0.3% at $1,733.70 per ounce, as of 0749 GMT. U.S. gold futures eased 0.2% to $1,735.70.
The dollar strengthened 0.7% to its highest since late-2002, weighing on gold's appeal among overseas buyers, and sent bullion prices towards a nine-month low of $1,731.00 hit on Wednesday.
"While gold is caught between elevated inflation risks and growing concerns over a recession, it has reverted to taking its cue from the dollar, which has benefited from safe-haven flows over gold," Standard Charted analyst Suki Cooper said in a note.
"Gold is also vulnerable to a weaker price floor amid the seasonally slow period for demand; a key level is $1,690/oz." Bullion lost nearly 4.2% so far this week.
It is likely to drop for a fourth straight week, in its biggest weekly decline since June 18, 2021.
Two of the Federal Reserve's most vocal hawks said on Thursday they would support another 75 basis-point interest rate hike later this month but a downshift to a slower pace afterward.
Gold bulls were hoping for some reprieve from the Fed, given the market narrative has pivoted from inflation fears to slowdown concerns, said Stephen Innes, managing partner at SPI Asset Management.
Rising interest rates increase the opportunity cost of holding bullion. Gold could have trouble crossing $1,750-60 on firmer Treasury yields, heading into next week's heavy U.S. data docket, headlined by the consumer price index, Innes said.
Spot silver dropped 0.8% to $19.04 per ounce, and platinum fell 0.4% to $869.74. Both were set for weekly losses.
Palladium eased 0.2% to $1,987.33, but has gained about 1.2% for the week.
(Reporting by Bharat Govind Gautam in Bengaluru; Editing by Rashmi Aich and Sherry Jacob-Phillips)