×

We've got news for you.

Register on BusinessLIVE at no cost to receive newsletters, read exclusive articles & more.
Register now
Picture: 123RF/BASHTA
Picture: 123RF/BASHTA

Bengaluru — Gold prices firmed on Friday as the dollar continued to weaken, and helped put bullion on track for a second straight weekly rise amid cooling bets for a more aggressive Federal Reserve monetary policy.

Spot gold was up 0.2% at $1,854.05/oz by 3.25am GMT. US gold futures were up 0.2% at $1,851.90. For the week so far, bullion is up 0.4%.

Gold this week has been supported by a moderation somewhat in market expectations from the Fed’s monetary policy for next year, and most importantly the weaker US dollar, said Ilya Spivak, a currency strategist at DailyFX. There is price support at $1,830 on the downside and on the topside the next key level is around $1,885, Spivak added.

Minutes of the Fed’s May 3-4 policy meeting released on Wednesday highlighted, as the market expected, that most participants favouring additional 50 basis point rate hikes at the June and July meetings. Higher short-term US interest rates and bond yields raise the opportunity cost of holding bullion, which yields nothing.

The dollar index fell en route a second straight weekly decline, making bullion less expensive for buyers holding other currencies. “We need a clearer signal that hard economic data is turning sour for the Fed to even think about a pause [in tightening] ... hence gold investors are still reluctant to push the envelope significantly higher,” said Stephen Innes, managing partner at SPI Asset Management. “If the Fed signals a pause, then gold will move much higher, but until they do so, we could be range trading for a bit.”

Spot silver dipped 0.2% to $21.95/oz, and has gained about 1.5% so far this week. Platinum was nearly flat at $950.28. Palladium gained 0.1% to $2,015.96 and was set for a weekly gain of about 3%, its most since early April.

Reuters

subscribe

Would you like to comment on this article or view other readers' comments?
Register (it’s quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.