PRECIOUS-Gold eyes best week in nearly 2 months on Fed pause hopes

PRECIOUS-Gold eyes best week in nearly 2 months on Fed pause hopes

Shafaq News/ Gold was set on Friday for its biggest weekly gain in nearly two months, as hopes for a pause in the Federal Reserve's tightening campaign bolstered bullion's appeal amid progress on the U.S. debt-ceiling deal.

Spot gold XAU= was flat at $1,978.74 per ounce, as of 0241 GMT. U.S. gold futures GCcv1 were also little changed, at $1,996.20.

Bullion has gained 1.7% so far in the week, heading for its best week since the week ended April 7

Current gold market sentiment remains constructive, and prices could move a little higher from here as the Fed is expected to stay on hold in June, said Edward Meir, a metals analyst at Marex.

Philadelphia Fed President Patrick Harker said on Thursday U.S. central bankers should not raise interest rates at their next meeting, even though high inflation is coming down at a "disappointingly slow" pace.

Markets now see a 73.7% chance of rates remaining unchanged in June. Gold, which does not yield any interest of its own, loses appeal when interest rates rise.

The dollar index .DXY traded close to a one week-low, making gold less expensive for buyers holding other currencies.

Meanwhile, the U.S. Senate passed bipartisan legislation backed by President Joe Biden that lifts the government's $31.4 trillion debt ceiling, averting what would have been a historic, first-ever default.

On the data front, investors will keep a tab on the U.S. Labor Department's non-farm payrolls (NFP) report due at 1230 GMT.

The figures could again sway "market opinion with regards to what the FOMC does next week", said Tim Waterer, chief market analyst at KCM Trade.

A strong labour market print could see a bounce-back in the dollar, which would not help gold, Waterer added.

Spot silver XAG= rose 0.1% to $23.926 per ounce and was up 2.7% for the week.

Platinum XPT= fell 0.2% to $1,004.32, while palladium XPD= held steady at $1,393.94.


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