Gold ticked up today, hovering within sight of a lifetime high, but a steadier euro could curb gains after improving US and China data suggested growing global economic strength.
China's manufacturing sector gathered momentum in September, handily beating market forecasts and providing further evidence that the economy is pulling smoothly out of a second-quarter slowdown.
China's financial markets are closed for a week from Oct. 1 to 7 for the National Day holiday.
Silver held near a 30-year high, platinum rose to a four-month high to track gains on TOCOM platinum futures while industrial demand helped sister metal palladium stayed near its strongest level since early 2008.
Spot gold added $US5.15 an ounce to $US1310.40 after hitting a record around $US1315 on Thursday, racking up its eighth consecutive quarterly gain as the US Federal Reserve appeared ready to pump more cash in the struggling economy.
"I guess speculation will still be rife as to the state of the US economy. The need or not for a QE2 (second round of quantitative easing) from the Fed," said Darren Heatchcote, head of trading at Investec Australia in Sydney.
"I think we can expect (gold) to remain volatile. Its movement has been determined by the US dollar at the moment."
But Thursday's data showed new US jobless claims fell last week, regional manufacturing grew faster than expected and consumer spending was slightly stronger than expected earlier in the year, injecting a little caution about the prospects for more quantitative easing from the Fed.
"If it stays above $1305, I think the more medium-term target could be sort of $1345," said Heathcote of Investec.
US gold futures for December delivery rose $US2.1 an ounce to $US1311.7 an ounce, having struck a record at $US1317.50 on Thursday.
The euro paused below a five-month high on the US dollar on Friday and the greenback steadied after dropping to an eight-month low against a basket of currencies the previous day, with the market looking ahead to US and Chinese data.
The physical market was slow, with Hong Kong off for a holiday, while dealers in Tokyo saw a bit of activity in Platinum Group Metals.
Higher gold prices widened the discounts for gold bars in Tokyo to 50 cents below the spot London price from 25 cents last week.
The world's largest gold-backed exchange-traded fund, SPDR Gold Trust, said its holdings eased to 1304.776 tonnes by Sept 30 from 1305.688 tonnes on Sept 28.
The holdings hit a record at 1,320.436 tonnes on June 29.
"There's a bit buying on TOCOM platinum, that's why spot price is increasing. But I don't see demand the industrial sector because the price is too high anyway," said a dealer in Tokyo.
"There's a bit of buying for palladium in Japan and also the other parts of Asia. That demand comes from the auto and dental industries."
Platinum and palladium are used in jewellery, autocatalysts and also in dentistry.
In other markets, Japan's Nikkei average rose 0.9 per cent on Friday after better-than-expected US economic data provided a degree of optimism, while crude oil was little changed near a seven-month high.
Reuters