Investing.com - Gold prices dropped on Friday after a better-than-expected consumer sentiment barometer sparked talk that the Federal Reserve may be closer to winding down stimulus programs.
Stimulus measures such as the Fed's monthly USD85 billion bond-buying program weaken the greenback to spur recovery.
Gold and the dollar tend to trade inversely from one another.
On the Comex division of the New York Mercantile Exchange, gold futures for August delivery were down 1.41% at USD1,392.05 a troy ounce in U.S. trading on Friday, up from a session low of USD1,389.85 and down from a high of USD1,421.25 a troy ounce.
Gold futures were likely to test support USD1,373.25 a troy ounce, Tuesday's low, and resistance at USD1,444.15, the high from May 14.
The Thomson Reuters/University of Michigan's final reading of U.S. consumer sentiment rose to 84.5 in May from 83.7 in April.
Analysts were expecting the index to remain unchanged this month, which strengthened the dollar and tarnished gold's image as a hedge to weaker paper currencies.
A separate report showed that the Chicago purchasing managers' index climbed to 58.7 this month from 49.0 in April, beating expectations for a rise to 50.0.
Elsewhere, official data revealed that U.S. personal spending fell 0.2% in April, defying expectations for a 0.1% rise and following a 0.1% increase the previous month, though markets shrugged off the data.
The dollar, meanwhile, saw further demand due to soft European indicators, which weakened gold even further.
Official data revealed that the eurozone's unemployment rate hit a record high 12.2% in April, up from 12.1% the previous month and in line with expectations.
Separately, a preliminary report showed that the eurozone's consumer price index rose to an annualized rate of 1.4% this month, from 1.2% in April, also in line with expectations.
In Germany, Destatits reported that retail sales in Europe's largest economy fell 0.4% in April, disappointing expectations for a 0.2% rise after a 0.1% decline the previous month.
Elsewhere on the Comex, silver for July delivery was down 2.21% at USD22.188 a troy ounce, while copper for July delivery was down 0.26% and trading at USD3.307 a pound.
Stimulus measures such as the Fed's monthly USD85 billion bond-buying program weaken the greenback to spur recovery.
Gold and the dollar tend to trade inversely from one another.
On the Comex division of the New York Mercantile Exchange, gold futures for August delivery were down 1.41% at USD1,392.05 a troy ounce in U.S. trading on Friday, up from a session low of USD1,389.85 and down from a high of USD1,421.25 a troy ounce.
Gold futures were likely to test support USD1,373.25 a troy ounce, Tuesday's low, and resistance at USD1,444.15, the high from May 14.
The Thomson Reuters/University of Michigan's final reading of U.S. consumer sentiment rose to 84.5 in May from 83.7 in April.
Analysts were expecting the index to remain unchanged this month, which strengthened the dollar and tarnished gold's image as a hedge to weaker paper currencies.
A separate report showed that the Chicago purchasing managers' index climbed to 58.7 this month from 49.0 in April, beating expectations for a rise to 50.0.
Elsewhere, official data revealed that U.S. personal spending fell 0.2% in April, defying expectations for a 0.1% rise and following a 0.1% increase the previous month, though markets shrugged off the data.
The dollar, meanwhile, saw further demand due to soft European indicators, which weakened gold even further.
Official data revealed that the eurozone's unemployment rate hit a record high 12.2% in April, up from 12.1% the previous month and in line with expectations.
Separately, a preliminary report showed that the eurozone's consumer price index rose to an annualized rate of 1.4% this month, from 1.2% in April, also in line with expectations.
In Germany, Destatits reported that retail sales in Europe's largest economy fell 0.4% in April, disappointing expectations for a 0.2% rise after a 0.1% decline the previous month.
Elsewhere on the Comex, silver for July delivery was down 2.21% at USD22.188 a troy ounce, while copper for July delivery was down 0.26% and trading at USD3.307 a pound.