Other precious metals, meanwhile, finished higher, with silver, platinum and palladium all hit new peaks. Most-active gold for February delivery on the Comex division of the New York Mercantile Exchange settled down 10 cents at $648.10 an ounce, trading between $645.80 and $654.80 an ounce - its loftiest level in 2007, near its 5-1/2-month peak of $655.50.
Estimated volume was 57,000 contracts, and options turnover was 22,000. Turnover in the Chicago Board of Trade's electronically traded 100-oz gold contract was 70,907 contracts as of 2:21 pm EST (1941 GMT).
Scott Meyers, senior analyst at Pioneer Futures, said that gold went into a technical resistance level around $654.60, which triggered some selling. "You can see more profit taking tomorrow," Meyers said. The February contract has gained more than 3 percent since January 18.
George Nickas at FC Stone said he was somewhat surprised by gold's unusual strength early before the first notice day of the February contract next Wednesday. As the first notice day approaches, investors have to decide whether to roll the February futures into the April contract, and that may create additional activity in the market.
Nickas attributed gold's early gain to some short covering ahead of the Federal Reserve Open Market Committee meeting beginning next Tuesday. James Quinn, commodity commentator at A.G. Edwards, said the fact that the February contract had surpassed $636, its 200-day moving average, was fuelling some investment interest.
Gold is generally seen as a hedge against oil-led inflation. Spot gold was quoted at $646.60/7.60 an ounce, compared with $647.20/8.20 traded late Wednesday. London's gold fix was $651.75. In other precious metals, silver hit a fresh six-week high. Comex March silver finished up 21.7 cents, or 1.6 percent, at $13.490 an ounce, traded between $13.245 and $13.600.
Spot silver climbed to $13.320/3.390, against $13.180/3.250 an ounce in late Wednesday trade. Silver was fixed in London at $13.380 an ounce. Nymex April platinum closed $14.90 higher at $1,188.00 an ounce, near its eight-week high. Spot platinum fetched $1,171.00/76.00.
Nymex March palladium ended up $6.30 at $355.45 an ounce, after hitting a four-month high of $356.85 earlier. Spot palladium was quoted at $350/354.00.