REUTERS: Gold fell to a five-year low on Friday, pressured by a strong dollar and expectations for a U.S. rate hike this year, and as China bought less than expected over the past six years.

Platinum fell below the key US $ 1,000-an-ounce level for the first time in more than six years while palladium extended losses to hit its lowest since November 2012.

China’s gold reserves were up 57 percent at the end of June, from the last time it adjusted its reserve figures more than six years ago, the central bank said. Despite the tonnage increase, gold now accounts for 1.65 percent of China’s total forex reserves, against 1.8 percent in June 2009. The reduced ratio suggested China will increase its bullion purchases, but the market focused elsewhere, traders said. “The market’s saying China’s been buying gold but they bought a lot less than what they should have,” said Phillip Streible, senior commodities broker for RJO Futures in Chicago.

Spot gold dropped 1.1 percent to its lowest since April 2010 at US $ 1,130.70 an ounce and was last down 1 percent at US $ 1,133.13. It was on track for a 2.6 percent weekly fall, the biggest since early March.

Spot platinum fell 1.4 percent to US $ 991 an ounce, the lowest since February 2009.

“If the low figure is correct then that is actually very bullish because there is plenty of scope for continued buying for many years to come,” said Ross Norman, Chief Executive of bullion brokerage Sharps Pixley in London, referring to China’s gold reserves.

U.S. August gold futures settled down 1 percent at US $ 1,131.90 an ounce. “The weakness we are seeing is related to the strength of the U.S. dollar,” said Norbert Ruecker, head of commodity research at Julius Baer. The dollar index rose to its highest since April on strong U.S. jobs data, while global shares slipped after disappointing corporate results.