1st LD Writethru: Gold down on profit-taking

Gold futures on the COMEX division of the New York Mercantile Exchange fell Friday as traders took profits after a week of much stronger gold prices due to economic instability.

The most active gold contract for April delivery fell 8.4 U.S. dollars, or 0.67 percent, to settle at 1,239.40 dollars per ounce.

The precious metal was put under pressure as profit-takers sold their gold positions ahead of the weekend. Analysts noted that the price of gold has skyrocketed in recent days due to falling U.S. equities. On Friday, the U.S. Dow Jones Industrial Average rose by 1.82 percent, recovering some of the losses from earlier in the week.

Gold was put under further pressure as a report issued by the U.S. Department of Commerce Friday showed retail sales gained 0.2 percent during the month of January.

The U.S. dollar also rose, putting pressure on gold. The index is a measure of the dollar against a basket of major currencies. Gold and the dollar typically move in opposite directions, which means if the dollar goes up, gold futures will fall as gold, measured by the dollar, becomes more expensive for investors.

Analysts believed that a delay in the U.S. Federal Reserve's rate hike is inevitable due to the instability. Prior to Fed Chairwoman Janet Yellen's address to the U.S. Congress Wednesday, the U.S. central bank hinted that it could still raise rates in March. In Yellen's testimony to Congress Wednesday, however, the increases would be gradual, so many analysts believe that the next rate hike will occur much later in the year. According to the CMEGroup's Fedwatch tool, the current implied probability of a hike is at 0 percent at the March meeting.

Silver for March delivery fell 0.4 cents, or 0.03 percent, to close at 15.79 dollars per ounce. Platinum for April delivery dropped 5.1 dollars, or 0.53 percent, to close at 958.10 dollars per ounce. Endit