Gold set for fourth straight weekly decline
Shafaq News
Gold prices were on track for a fourth consecutive weekly fall on Friday, as a resilient dollar and expectations of faster U.S. rate hikes to tame inflation kept bullion pressured near the key $4,000-per-ounce level.
Spot gold was steady at $4,027.91 per ounce, as of 0752 GMT. U.S. gold futures for August delivery edged 0.1% lower to $4,043.40.
"The rapid repricing of the hawkish Fed created a strong bullish momentum in the U.S. dollar, which eventually led to this significant downward drift in gold prices," said Kelvin Wong, a senior market analyst at OANDA.
The U.S. dollar index was headed for a second consecutive weekly gain, making gold more expensive for holders of other currencies.
Wong sees the multi-month correction in gold, since the record high reached in late January, extending towards $3,400 in the long term.
Gold prices have fallen about 29% from the record high of $5,594.82 on January 29, as inflation fuelled by the U.S.-Iran war ramped up rate-hike bets.
Data on Thursday showed that U.S. inflation increased further in May, breaking above 4.0% for the first time in three years, as forecast by economists surveyed by Reuters.
Although gold is typically viewed as a hedge against inflation, it tends to lose its appeal as a non-yielding asset in a high-interest-rate environment.
Traders expect three Fed rate hikes this year and are pricing in about a 64% chance of a September increase, according to the CME FedWatch Tool. FEDWATCH/
Among other metals, spot silver edged 0.1% lower to $57.80 per ounce, platinum lost 0.3% to $1,605.18, while palladium gained 1.4% to $1,200.75. All metals were headed for a weekly loss.
(Reuters)
Only the headline is edited by Shafaq News Agency.
