SINGAPORE (Commodity Online) : Gold prices remained highly volatile in Asian trade Friday mainly on US president Obama’s plans to restrict risk taking by banks.

US gold futures for February delivery was seen trading at $1094.80 per ounce at 11.30 a.m Singapore time while spot gold was at $1094.80 an ounce at the same time.

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On Thursday, March delivery settled at $1103.20 on the COMEX division of the New York Mercantile Exchange while Spot gold closed at $1094.20 an ounce.

Analysts said the precious yellow metal remained under pressure on Friday as Obama's plans to limit financial risk taking raised concerns about diminishing capital flows from banks, which have provided liquidity for gold and commodities investors.

While falling prices could offer some good bargains, investors will likely wait to see how long the global stock market plunge continues and how much in speculative long positions is cleared by current selling before returning to buying Gold and other precious metals in full force, he said.

At current levels, spot gold would have fallen about 3 per cent on the week, the largest weekly drop in six weeks, they said.

Meanwhile, the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, halted, with its holdings remaining unchanged at 1,111.922 tones as of January 21 from the previous business day.

A rise in the U.S. dollar to a five-month high against the euro and worries that China would cool growth, limiting the need for inflation-hedging assets like gold, weighed on the metal.

A sharp sell-off in U.S. stocks, partly related to worries about proposed restrictions on U.S. bank activities, also dampened demand for commodities. March Copper ended the floor session at $3.295 a pound, down 6 cents, or 1.8%.

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