Gold falls as dollar recovers

Gold drifted lower on Friday after early gains, and analysts said the market needed a catalyst to break out of its trading range and march towards record highs above $1,000 an ounce.

The upward push could come from poor earnings results oflarge US financial companies, weak economic data or a sharp change in the currency and energy markets, analysts said.

Gold, traditionally seen as a safe-haven asset and a hedge against inflation, often thrives on bad news.

The metal is also considered as an alternative investment to the dollar and often moves in the opposite direction of the currency.

The precious metals markets have had a fairly good run this week and they are just consolidating, said David Thurtell, metals analyst at BNP Paribas.

It’s likely that the market will trade pretty quietly for the next week.

Gold rose as high as $946.40 an ounce before falling to $931.90/932.60 against $938.90/939.70 in New York late on Thursday, when it hit a three-week high. The metal traded in a range of $914.00-$952.60 this week.

US gold futures for June delivery fell $7.00 per ounce to $935.80 in electronic trade. Bullion investors watched the dollar and oil for direction.

All in all, it should be a quieter day for gold, unless unforeseen events hit the news wires. In other metals, palladium rose $2 to $458/463 an ounce, but silver fell to $18.10/18.15 an ounce from $18.23/18.28 in New York late on Thursday.

Platinum fell to $2,030/2,040 an ounce from late New York levels of $2,042/2,052, but analyst saisd the market was expected to remain supported.

The South African power shortages are keeping the platinum market on edge as a swift resolution to the structural problems is far from near, Barclays Capital said in a report.