Gold Holds Steady in Holiday-Thinned Trade

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"Weak dollar is helping to support gold."

Gold was mostly steady on Friday, holding near $845 amid views that the dollar would remain under pressure given the grim outlook of the U.S. economy, but activity was slow due to the holiday season. Gold has lost about 18% of its value from the record high of $1030.80 marked in mid-March.

Koji Suzuki, a senior analyst at SBI Futures Co Ltd, said a weak dollar was benefiting gold, which often trades with an inverse correlation to the dollar due to its role as a hedge against the U.S. currency. "The lack of liquidity is mostly behind recent market moves as position adjustment takes place, but that is about all that's happening," he said.

Russia's gold and foreign exchange reserves rose by a record $15.4 billion in the latest week thanks to a stronger euro and a rise in commercial banks' foreign currency deposits.

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