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Gold price backs off on rising dollar, but set for fifth weekly rise

Gold prices edged lower on Friday as the US dollar firmed, although hopes of slower rate hikes from the Federal Reserve are still keeping bullion on track for a fifth straight weekly gain.

Spot gold slipped 0.3% to $1,925.25 per ounce by 11:40 a.m. ET, still enough to maintain a slight gain of 0.7% for the week. US gold futures, on the other hand, moved 0.2% higher at $1,927.70 per ounce.

[Click here for an interactive chart of gold prices]

Meanwhile, the dollar rose 0.3% against its rivals, making gold more expensive for holders of other currencies.

“The US dollar is finding some form of stability and in turn we could see gold prices heading lower into next week,” Daniel Ghali, commodity strategist at TD Securities, told Reuters.

However, recent US economic readings and hawkish remarks from Fed policymakers have fuelled worries over a global slowdown and prompted investors to seek refuge in the safe haven metal.

Commentary from Fed officials has pointed to a terminal rate above 5%, but traders still bet on rates peaking at 4.9% by June and see a 93.7% chance for a 25-basis point rate hike in February.

While there here has been an accumulation of gold by various central banks and agencies, gold ETFs held by individuals have been decreasing. Were ETF buying to return, that would limit any overbought dip in the metal, said Caesar Bryan, gold portfolio manager at Gabelli Funds.

(With files from Reuters)

Read more: Gold price seen rising towards record highs as rate rises near end

Source: MINING.COM – Read More

 


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