Gold prices inch higher on softer dollar and are set for weekly fall

Date:

Spot gold rose 0.2% to $1,746.84 per ounce by 0102 GMT, after hitting its lowest since Aug. 11 at $1737.46 on Thursday.

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U.S. gold futures eased 0.1% to $1,747.80.

Gold prices edged higher on Friday after falling more than 1% in the previous session, helped by a subdued dollar, although Federal Reserve’s plans on reducing stimulus to the U.S. economy kept the bullion on track for a third straight week of declines.

Fundamentals

Spot gold rose 0.2% to $1,746.84 per ounce by 0102 GMT, after hitting its lowest since Aug. 11 at $1737.46 on Thursday. Prices were down 0.4% for the week.

U.S. gold futures eased 0.1% to $1,747.80.

The dollar index languished near a one-week low hit on Thursday, making gold cheaper for those holding other currencies.

The number of Americans filing new claims for unemployment benefits unexpectedly rose last week, but the underlying trend remained consistent with a steadily recovering labor market.

Fed Chairman Jerome Powell said tapering process could conclude around the middle of next year, as long as the recovery remains on track, after the central bank’s policy statement this week suggested it may lift interest rates earlier-than-expected.

Gold is often considered a hedge against higher inflation, but a Fed rate hike would increase the opportunity cost of holding gold, which pays no interest.

World stock markets rallied on Thursday as worries about contagion from cash-strapped China Evergrande faded, denting gold’s safe-haven appeal.

Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, dropped 0.8% to 992.65 tons on Thursday from 1,000.79 tons on Wednesday.

Silver rose 0.5% to $22.61 per ounce and was up 1% for the week so far.

Palladium rose 0.5% to $1,992.67, but was on track for third straight week of decline.

Platinum slipped 0.8% to $980.67. However, the metal was headed for a 4.3% weekly gain, biggest in six weeks.


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Naija247news is an investigative news platform that tracks news on Nigerian Economy, Business, Politics, Financial and Africa and Global Economy.

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