Gold fell more than 1% to a five-year low on Wednesday as a bounce in the dollar fueled downside momentum, with investors continuing to pull away from the metal after its dramatic slide earlier this week.
Billionaire hedge fund manager John Paulson, who told investors as recently as last month that they should own gold, cut his holdings in the metal by more than half as prices plunged into a bear market.
Gold advanced in New York after the Federal Reserve said it will keep buying debt to stimulate the U.S. economy and holdings in the biggest exchange-traded fund backed by bullion held steady for a fourth day.
U.S. dollar gold prices climbed back towards $1,556 per ounce Friday morning in London, the level that was until yesterday's falls the 2013 low, as stocks and commodities fell ahead of the release of monthly U.S. jobs data.
Spot market gold bullion prices hovered just below $1,670 an ounce for most of Friday morning's London trading, a few dollars below yesterday's four-month high. Stock markets ticked lower and US Treasuries gained, as analysts speculate on the prospects for more quantitative easing .