Gold inched up on Friday as higher oil prices boosted its safe-haven appeal, but the metal looked set to post its third straight weekly loss, weighed down by a strong dollar.
Bullion ended 2014 down nearly 2 percent, following a 28 percent slump the previous year, as its investment appeal tapered amid better-performing equities, Reuters reported.
Many analysts expect another tough year for gold, with the dollar expected to gain further on expectations of higher US interest rates and a recovering economy.
“We think it is likely that gold may test $1,000 in 2015, but thereafter we expect a rebound in prices as investors may rush in to buy the precious metal on dips,” said Howie Lee, analyst at Phillip Futures, in a note this week.
A stronger dollar, global deflationary pressures, slowing Chinese demand and higher rates will hurt gold prices, Lee said. Spot gold rose 0.3 percent to $1,185.20 an ounce by 0732 GMT, following an uptick in oil. Liquidity was thin in post-holiday trading, with Chinese and Japanese markets closed on Friday.
Brent and US crude futures edged higher on the first trading day of 2015 in Asia, supported by last week’s larger-than-expected fall in US crude stocks, although China’s lackluster economic data capped gains.
