Gold prices have tumbled for the seventh straight session on Friday as the dollar gained on the back of renewed concerns on the future of the US Federal Reserve's bond-buying programme.

The precious metal lost nearly 5% in the week and the bullion for June delivery fell almost 1% or $13.30 to $1,373.60 an ounce. The gold-backed exchange traded funds also fell 4% this week, adding to a 14% decline in the first quarter.

Investors remained wary of gold investments as the recent surge in equity markets and positive consumer prices data from the US curbed the yellow metal's appeal as a hedge against inflation.

The greenback climbed to a near ten-month high against all the six major currencies after the comments of John Williams, president of the Federal Reserve Bank of San Francisco that the central bank could begin to roll back its asset buying by this summer.

Though Williams does not have a vote in the Federal Open Market Committee this year, his comments weighed on the US markets as the Fed purchases $85bn a month in bonds.

European as well as Asian stocks pulled back from their recent highs taking cues from an overnight Wall Street closing, which saw the S&P 500 shares losing their gains.

Gold Trends

Total gold demand declined 13% in the quarter due to a massive liquidation in exchange traded fund (ETF) holdings, showed WGC's Gold Demand Trends Survey.

Over 175 metric tonnes of bullion flowed out of gold ETFs in the first three months of the year and analysts are expecting outflows of another 250 metric tonnes as investors continue to cut down their holdings.

"The need to buy gold for wealth preservation fell down and the probability of inflation on a one to three year horizon is significantly diminished," Ric Deverell, head of commodities research at Credit Suisse Group told the Bloomberg.

He expects gold to slip to $1,100 an ounce in a year and below $1,000 in five years.

Soros Fund Management, owned by billionaire investor George Soros was one among the funds, which cut its holdings in SPDR Gold Trust, the biggest gold ETP, in the first quarter, showed the SEC filings. However, billionaire hedge-fund manager John Paulson held his stakes in the GLD in the quarter.

Though the central banks added more than 100 tonnes of gold to their reserves in the first quarter, the level of purchasing was 5% lower than year-earlier levels, according to WSG. In technology sector, gold demand declined 4% on-year to 102 tons in the first quarter.

Global gold supply was little changed at 1,051.6 tonnes in the first quarter.