Gold futures skidded lower on Friday, extending their retreat beneath a psychologically important level at 1,900, but still headed for a weekly and monthly advance.
Investors were watching for further evidence of rising inflation and awaiting the Federal Reserves preferred measure of pricing pressures, the personalconsumption expenditure index due at 830 a.m. Eastern Time.
August gold the most active contract, dropped 11.70, or 0.6, to 1,886.50 an ounce, following a 0.3 decline on Thursday to mark its first loss in four sessions.
Prices, based on the mostactive contract, still trade more than 6 higher month to date and were looking at a weekly advance of 0.6. On Wednesday, they settled atop 1,900 an ounce and turned positive for the year, a day after hitting a high near that resistance level.
Golds rise this week has been helped by a weak U.S. dollar, but the currency was gaining momentum higher early Friday, up 0.4. A weaker dollar can make assets priced in that currency more attractive to overseas investors. For the week, the DXY is up 0.4.
A slide in the yield on the 10year Treasury note had also helped buoy gold buying. Falling yields can benefit precious metals and other commodities, which dont offer a coupon, by reducing the opportunity cost of holding those assets against yieldbearing investments.