Gold futures gained for the second time in three sessions as the dollar fell from a five-year high, boosting demand for the metal as an alternative investment.
The dollar lost as much as 0.2 against a basket of 10 currencies after touching the highest since March 2009. Bullion slid earlier after a government report showed the U.S. economy expanded more than expected, damping demand for the metal as a store of value.
Gold has fallen 14 percent from a 2014 high, and global holdings in exchange-traded products backed by the metal last week slumped to the lowest since May 2009, amid gains in the dollar on an improving U.S. economy. Faster growth supports the Federal Reserves decision last month to stop buying debt as policy makers monitor economic progress while deciding when to raise interest rates for the first time in eight years.
Gold futures for February delivery rose 0.1 percent to settle at $1,197.80 an ounce on the Comex at 1:40 p.m. in New York. The metal slid as much as 0.6 percent earlier. Bullion posted two straight weekly gains through Nov. 21 amid central bank action from China to Japan to Europe to boost growth.
U.S. gross domestic product grew at a 3.9 percent annualized rate in the third quarter, capping the strongest six months in a decade and topping the 3.3 percent estimate in a Bloomberg survey of economists, a government report showed today.