SINGAPORE (Commodity Online) : Gold prices recovered from overnight slump in Asian trade Friday but remained highly volatile as the dollar gained momentum. Spot gold was seen trading at $1235.54 an ounce at 11.30 a.m Singapore time while U.S. gold futures for June delivery was at $1,235.8 an ounce at the same time.
The euro dropped against the dollar on Friday as concerns grow about anaemic growth in the euro zone.
The single currency has broken the bottom of its recent trading range near $1.2610 and is expected to test key support near $1.25.
Analysts say the precious yellow metal moved up as investors turned their backs on the euro on worries that Europe crisis will slow growth.
They said the bullion was heading for its fourth consecutive weekly rise, equalling a run that ended in late November.
Its safe haven appeal has increased on worries a $1 trillion rescue package to prevent a Greek debt crisis from spreading to other euro zone states would eventually fail. Bullion struck a record high of $1,248.15 on Wednesday.
Meanwhile, the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, said its holdings were unchanged at a record high of 1,209.499 metric tones as of May 13, which suggested that investors had little desire to book profits yet.
On Thursday US gold futures ended 1 percent lower as investors locked up profits after the metal hit record highs the past two days. June contract settled at $1,229.20 an ounce.