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Gold edged up on Friday on a weaker dollar, but the yellow metal was on track for a seventh straight weekly decline amid expectations that the U.S. Federal Reserve will opt for more interest rate hikes in 2017.

Spot gold edged up 0.2 percent to $1,131.36 an ounce by 0639 GMT.

"There is not much reaction (to the news) because the pre-holiday liquidity is very tight," said Helen Lau, an analyst at Argonaut Securities in Hong Kong.

"It is very difficult to gauge the short term direction," Lau said, adding that gold might move according to the dollar.

"Low volatility may be contributing to gold’s weakness," said HSBC analyst James Steel, adding that the heavy drop in the gold exchange traded funds is weighing on the market.

Holdings of SPDR Gold, the world's largest gold-backed exchange-traded fund, have fallen over 12 percent since November.

"Gold is on the defensive but we sense support in the market between $1,120-1,100 and believe these levels will hold barring a significant dollar rally."

Reference: Reuters