Snapping its four-session winning streak, gold was moving lower Friday morning as the US dollar steadied after recent dips.
Gold for August delivery, the most actively traded contract, eased $5.50 to $1,274.40 an ounce. Yesterday, gold extended gains for fourth session to settle at a near three-week high, with the dollar weakening against some major currencies after the U.S. Federal Reserve indicated it would continue to maintain its quantitative easing policy. Investors also weighed comments by Fed Reserve Chairman Ben Bernanke that the central bank will continue to hold interest rates at a low level even after unemployment rate touches the targeted 6.5 percent.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, were unchanged at 939.07 tons.
Meanwhile, the U.S. dollar was hovering around its six-week high versus the euro and a four-month high against sterling. The buck was moving higher versus the Swiss franc and the yen.
In economic news, euro zone industrial production declined 0.3 percent month-on-month in May, in line with expectations, reversing April's 0.5 percent rise, data from Eurostat showed. The decline was driven by a 1.5 percent fall in capital goods output and 2.3 percent decrease in durable consumer goods. On a yearly basis, industrial production slipped 1.3 percent, more than double the 0.6 percent drop seen in April. The annual rate of decline matched economists' expectations.
Elsewhere, the prices of silver and platinum were ticking lower in morning deals.
From the U.S., the Labor Department will release its report on producer prices at 8:30 am ET. Economists expect a 0.5 percent increase in the headline producer price index and a 0.2 percent increase in core producer prices.
Reuters and the University of Michigan will release the results of their preliminary consumer sentiment survey at 9:55 am ET. The consumer sentiment index is expected to have remained unchanged at 84.1.
