Singapore: Gold inched up on Friday as higher oil prices boosted its safe-haven appeal, but the metal looked set to post its third straight weekly loss, weighed down by a strong dollar.
FUNDAMENTALS
Spot gold rose 0.4 percent to $1,186.75 an ounce by 0030 GMT, after ending 2014 down about 2 percent.
U.S. crude futures hit $55.11 a barrel before easing below $55 a barrel on the first trading day of 2015 in Asia, supported by last week`s larger-than-expected fall in U.S. crude stocks.
Higher oil prices support gold as the metal is seen as a hedge against oil-led inflation.
Despite Friday`s gains, bullion is down 0.7 percent for the week.
The dollar index, a measure of the greenback`s strength against a basket of six major currencies, was trading close to its highest in nearly nine years.
The index ended 2014 with its biggest annual increase since 1997, boosted by strong U.S. economic data and expectations of higher interest rates.
A stronger dollar makes gold more expensive for holders of other currencies and also reduces its appeal as a hedge.
Investor sentiment continued to be bearish. Holdings in SPDR Gold Trust, the world`s largest gold-backed exchange-traded fund, fell 0.25 percent to 709.02 tonnes on Wednesday - a fresh six-year low.
