By Apeksha Nair
(Reuters) - Gold remained volatile in Asian trade on Friday, but looked set for its first weekly decline in four, with investors continuing to mull over the economic outlook after Donald Trump won this week's U.S. presidential election.
Spot gold was at $1,260.12 an ounce at 0251 GMT, near yesterday's close, while U.S. gold futures were down 0.6 percent at $1,259.30 per ounce. Spot gold was set to end the week down 3.6 percent.
The dollar hovered at a 3-1/2-month high versus the yen early on Friday, extending big overnight gains as markets prepared for a Trump presidency that could stimulate the U.S. economy fiscally and lift interest rates.
"The stronger U.S. dollar and a more conciliatory tone from Trump continues to weigh on investor demand," ANZ analysts noted.
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The latest U.S. jobs data showed the number of Americans filing for unemployment benefits fell more than expected last week.
The Federal Reserve could raise interest rates more quickly if Washington used lower taxes or higher spending to boost economic growth, Richmond Fed President Jeffrey Lacker said on Thursday.
Gold is highly sensitive to rising rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar, in which it is priced.
The dollar index, which measures the greenback against a basket of major currencies, fell 0.1 percent to 98.665.
"Gold is moving according to the dollar. The financial sector seems to have stabilized for a second day on Thursday," said Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong.
"Some strong physical buying at the lower end is keeping gold from not falling too much. Whenever there is a dip, we have seen strong buying," Leung added.
SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings fell 1.40 percent to 941.68 tonnes on Thursday from 955.03 tonnes on Wednesday.
Spot gold may bounce moderately to resistance at $1,271 per ounce before falling, as it has found a support at $1,255, according to Reuters technical analyst Wang Tao.
Silver was down 0.4 percent at $18.47 an ounce.
Platinum dropped 0.4 percent to $968.55. The metal hit a fresh 2-week low of $958.50 earlier in the session.
Palladium was little changed at $689. The metal touched a high of $697.90 earlier in the session, its highest since Oct. 5.
(Reporting by Apeksha Nair in Bengaluru, additional reporting by Nallur Sethuraman; Editing by Richard Pullin and Joseph Radford)
Disclaimer: No Business Standard Journalist was involved in creation of this content
