By Katherine Dunn

LONDON--Gold prices were again under pressure from a stronger dollar on Friday in London.

Spot gold was down 0.13% at $1,264.61 a troy ounce in mid-morning trade, extending the previous day's modest loss and breaking back down through the technically important 200-day moving average.

The WSJ Dollar Index, which measures the dollar against a basket of other currencies, was up 0.09%. On Friday, the greenback strengthened to fresh highs against the euro and several Asian currencies, including the Chinese yuan.

The drop in the euro came after comments from the head of the European Central Bank implied the bank may extend its bond-buying program, putting pressure on the currency.

Gold prices, like other commodities denominated in dollars, typically fall as the dollar gains strength. A stronger dollar makes the metal more expensive for other investors, resulting in less demand.

However, moves in the metal remained muted as investors waited from more cues from the U.S. on both the timing of a rate increase, now expected in December, and the outcome of the presidential election.

"I don't think there's much going on until the U.S. elections," on Nov. 8, said Simona Gambarini, a commodities economist at Capital Economics in London.

However, "if Trump was to gain ground, we would probably see a big jump in gold prices," she said, while noting that a Trump victory now seems unlikely. Analysts say a Trump victory would likely stoke initial safe haven buying of the metal.

Meanwhile, seasonal demand for the metal is picking up in India as festival season kicks off, Commerzbank AG said.

"Dhanteras and Diwali will be celebrated at the end of the month--two of the most important Hindu festivals and a time when gold is traditionally given as a gift," the bank noted.

India and China are the largest physical buyers of the metal.

The other precious metals were also trading lower on Friday. Silver was down 0.17% at $17.52 a troy ounce, platinum was down 0.51% at $929.75 a troy ounce, and palladium was down 1.30% at $624.25 a troy ounce.

Gregor Stuart Hunter and Hiroyuki Kachi contributed to this article.

Write to Katherine Dunn at katherine.dunn@wsj.com

(END) Dow Jones Newswires

October 21, 2016 06:58 ET (10:58 GMT)