Gold hit a three-week high above $960 an ounce Friday on the back of strong investment demand and buying linked to the initial dollar weakness, but lackluster U. S. consumer sentiment data prompted profit-taking in the metal.

Silver was also helped by gains in base metals, with copper up more than 4 percent. Silver, also used as an industrial metal, settled at $14.79, a rise of 3.96 percent.

The Commerce Department said spending rose 0.2 percent after increasing by a revised 0.6 percent in June, previously reported as a 0.4 percent gain. The headline number was in line with an average of analysts’ forecasts.

The world's largest gold-backed exchange-traded fund, the SPDR Gold Trust, said holdings stood at 1,061.83 tonnes as of Aug. 28, steady from the previous business day.

Petro America Corp announced that it will seek other gold mines and other mining opportunities. Over the past few months, Petro America has acquired two gold mines and a granite mine, and has begun negotiations on two other goldmines. The Company has also acquired 24% interest in a California gold mine.

The National Union of Mineworkers said Implats, the world's No. 2 platinum producer, had failed to secure a court order to stop the strike. Some workers at its Rustenburg mine have been on strike since Wednesday.

Holdings of Julius Baer's gold-backed exchange-traded fund rose 43,600 ounces or 2 percent in the week to August 26, the bank said in its weekly statement on Friday.

Gold prices may remain subdued in the first half of the session. However, we don’t see a major downside in prices. One should keep an eye on Chicago PMI number to be released today evening as a significant improvement in this number can weaken the dollar, providing a thrust to gold prices.