Gold Prices On Track For Fifth Weekly Dip On Dollar Rally; Spot gold at $1,713.04 an ounce

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Gold edged higher on Friday as the dollar’s rally eased, although the greenback’s strong overall performance and fears of aggressive U.S. interest rate hikes weighed on bullion demand and set the bullion in check. price for a fifth consecutive weekly loss.

Spot gold was up 0.2% at $1,713.04 an ounce, as of 0252 GMT, but is down 1.6% so far this week. US gold futures rose 0.4% to $1,712.10.

“Gold has withered against a stronger US Dollar this week, but appears to be trying to form a temporary base ahead of $1,700.00. That said, it shows no signs of significant upside momentum with rallies limited to the $1,750.00 region,” OANDA principal analyst Jeffrey Halley said.

The dollar edged above recent 20-year highs, easing demand pressure for greenback-priced gold among overseas investors, after sending bullion down more than 2% on Thursday.

“In the larger technical picture, gold still looks vulnerable, with risks skewed to the downside,” Halley said.

Two of the US Federal Reserve’s most hawkish policymakers said on Thursday they favored another 75 basis point interest rate hike at the central bank’s monetary policy meeting this month, and No to the larger rate hike that traders had raced to price after a Wednesday report showed inflation was accelerating.

Higher interest rates and bond yields increase the opportunity cost of holding non-performing bullion.

Benchmark 10-year US Treasury yields fell slightly on Friday, supporting gold.

“Investment demand for gold is weakening,” ANZ Research said in a note, adding that gold will remain under pressure from expectations of a sharp Fed rate hike.

Spot silver fell 0.1% to $18.36 an ounce, but fell around 4.9% in what could be its seventh straight weekly loss.

Platinum gained 0.5% to $847.36. It fell about 5.5% this week, the most in three months.

Palladium rose 0.8% to $1,911.45, but lost around 12.4% this week, the most since last November.

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