By Claudia Assis, MarketWatch
SAN FRANCISCO (MarketWatch) -- Gold futures declined Friday on a stronger dollar and as some investors ditched gold and other commodities to meet equity margin calls.
Gold for December delivery retreated $7.10, or 0.6%, to $1,228.40 an ounce on the Comex division of the New York Mercantile Exchange. A close around these levels would tie with Monday for the lowest in the week.
Gains earlier in the week were so far guaranteeing a rise of nearly 1% on the week. Gold has risen in the past three weeks.
"People are trying to defend their equity positions," said Charles Nedoss, a senior market strategist at with Olympus Futures in Chicago. A rising dollar was also putting pressure on prices, he added.
The dollar index (DXY 83.16, +0.72, +0.87%) , which compares the U.S. unit to a basket of six currencies, rose 0.9% to 83.23.
The euro slumped to its lowest level against the dollar in more than a month Friday, after a German official said the European Central Bank will likely wait till 2011 to decide whether to begin phasing out emergency lending support for euro-zone banks and other institutions.
Gold closed at a seven-week high on Thursday, as initial claims for jobless benefits unexpectedly climbed and as two other indicators of economic activity underscored a slowdown in U.S. growth.
All asset classes faced headwinds on Friday. Stocks opened lower and Treasury yields reached new lows as investors sought the safety of gold.
Other metals followed gold, with copper, highly sensitive to downturns in economic activity and sentiment, and silver among the top losers.
Silver for September delivery lost 42 cents, or 2.3, to $17.91 an ounce. September copper declined 4 cents, or 1%, to $3.28 a pound.
