Gold prices steadied near the previous session's two-month lows on Friday and were poised for their worst weekly performance in over three years as a rallying U.S. dollar and expectations of less aggressive interest rate cuts by the Federal Reserve pressured the precious metal.

Gold fell for a fifth straight session on Thursday to hit its lowest level in eight weeks, pressured by a stronger U.S. dollar and rising Treasury yields amid uncertainty over the pace of the Federal Reserve's interest rate cuts.

Economists are seeing a new U.S. dollar decline factor that could account for gold's recent surge – and they don’t see it stopping soon.