LONDON—The spot price of gold continued to consolidate in a narrow range below $1,550 a troy ounce amid sluggish trade.
Ahead of the New York day, spot gold was off $4.90, or 0.3%, at $1,539.40 an ounce.
"Mixed currency flows and risk appetite are likely to see choppy and volatile trade across the precious metals in the coming sessions," said FastMarkets.com in a note. "However continued concerns surrounding sovereign debt levels, the threat of further downgrades and rising inflation will continue to bolster demand for gold, and to a lesser extend silver, as a store of wealth."
Swiss bank UBS on Friday raised its three-month gold forecast to $1,600 an ounce from $1,400 an ounce, citing an increasingly gloomy global economic outlook, among other factors.
"Weakness in global data is fostering more optimism on gold in the second half of this year and any downside moves should be limited given concerns about the economic picture," UBS analyst Edel Tully said in a note.
However, while the bank sees an increasingly gold-supportive macro environment further down the line, it predicted a possible gold reversal this summer as the U.S. Federal Reserve wraps up its liquidity-injecting quantitative easing program and demand hits a seasonal lull. As a result, it lowered its one-month forecast of the yellow metal to $1,475 an ounce from $1,500 an ounce.
Among other metals, spot silver was down 30 cents, or 0.8%, at $37.27 an ounce, spot platinum was down $7, or 0.4%, lower at $1,832 an ounce and spot palladium fell $2, or 0.2% at $812 an ounce.
Write to Francesca Freeman at francesca.freeman@dowjones.com
