Gold prices failed to hold a rally above $1,380 per ounce in London on Friday morning, trading 5% down for the week as world stock markets held steady.
Both the Euro and British Pound also cut their mid-week rallies against the Dollar, holding gold prices at €1070 and £904 per ounce respectively.
New data overnight showed Japanese machine orders leaping 14% in March from February, while China's leading economic index rose slightly for last month.
Eurozone construction output sank 8% in March from a year earlier.
"A spell of Dollar weakness looks like gold's only salvation at the moment," says one wholesale dealer in a note.
"So another disappointing data point could encourage more short-covering [when bearish traders close their position] ahead of the weekend."
The US Dollar crept towards a 10-month high vs. a basket of major currencies this morning.
US consumer sentiment data were due for release Friday at 09.55 New York time.
"Bullion's price break below the psychological $1,400 an ounce level may introduce additional near-term pressure on gold," says bullion market-maker HSBC's James Steel.
"However, physical demand is likely to pick up further given the price drop, to help stem potential losses."
Over in India – the world's biggest gold buying nation on an annual basis – "There is no supply," Reuters today quotes Prithviraj Kothari, head of Mumbai importers Riddhi Siddhi Bullions Ltd.
Thanks to this week's sudden imposition of Indian gold import restrictions, supply is so tight some distributors are charging up to $20 an ounce above international benchmark London prices, Kothari says.
Hong Kong premiums have jumped this week to record highs of $5 per ounce, with the kilogram gold bars favored by China's investment market now "hard to come by" according to one Singapore dealer.
Even so, "Many people are waiting on the sidelines," reckons Singapore dealer Brian Lan at GoldSilver Central Pte, "as they are expecting another drop" in global gold prices.
Amongst Western money managers, "We're seeing some of the pension funds selling via the
ETFs," reckons analyst Daniel Smith at Standard Chartered bank, "which is a bit of a worrying sign."
Exchange-traded trust funds backed by gold shed yet more metal on Thursday, with the two leading US funds – the GLD and IAU – dropping 7 tonnes between them to reach the lowest combined level since April 2010 at 1,233 tonnes.
Since Dec. 2012's all-time peak, the GLD and IAU have lost 21.4% of their combined gold ETF holdings.
"The price of silver in 2013 will primarily be determined on the demand side," says the latest Commodities Weekly from French investment bank and London bullion dealer Natixis, forecasting "relatively stable" supply with a slight dip in recycling.
On the industrial side it says, and "despite promising expectations from the rest of the world, we expect a slight drop in [photo voltaic] installations due to weak European [solar panel] demand" thanks both to low subsidies from government and the continued Eurozone crisis.
Silver ETF holdings have yet to follow gold trust funds sharply lower, Natixis notes – primarily because private investors own the former, as opposed to money managers in gold.
"[But] at some point these retail investors are likely to start selling."
Total silver ETF. holdings of 19,400 tonnes currently equate to 60% of last year's total market supply, the bank's analysis adds, and "an outflow...could introduce substantial downside risks for silver prices."