"We are still negative and targeting $ 985 in the short term," said analyst Dominique Schneider of UBS Wealth Management in Hong Kong. "The logic is clear to some extent. Fed will raise, and the dollar is going to see more strength and in that environment it would be difficult to a certain extent to maintain the current prices."
Stronger dollar hurt demand for commodities priced in the dollar by making it expensive for holders of other currencies.
The price of gold rose 0.1 percent to $ 1,083.26 an ounce by 0312 GMT. And was the weakest rate in more than five years at $ 1,064.95 per ounce on Wednesday and is set to close the week with little change.
US gold rose 0.5 percent to $ 1,083 an ounce.
New US applications for unemployment benefits fell last week, while the measure of US economic activity rebounded in October, signs of a healthy economy can give confidence the Federal Reserve to raise interest rates next month.
The dollar steadied on Friday after the recent rally that took the dollar to its highest level in seven months against a basket of peers.
Gold could come under further pressure from news that Chinese banks have turned more cautious about lending gold.
Chinese banks are growing worried about the increasing number of defaults among jewelry manufacturers, prompting them to review new gold lending more carefully, and according to sources with direct knowledge of the issue.
China's four largest banks alone up to 443400000000 yuan ($ 69.63 billion) tied up in gold leasing, so any decline may reduce China's imports hit the global gold prices.
However, a dealer in Singapore said there is evidence that some bargain hunting, which may help slow down the pace of the fall of gold.
"For everything went on the strength of the dollar. Gold seems to be borrowing rate is getting a bit more compact with the actual demand."