Gold prices were subdued on Friday and
looked set for a third straight weekly loss as the U.S. dollar
and Treasury yields rallied on a hawkish U.S. Federal Reserve
stance, with investors awaiting U.S. jobs data due later in the
Spot gold fell 0.2% to $1,873.75 per ounce, as of
0742 GMT, while U.S. gold futures were steady
The dollar was headed for a fifth winning week as benchmark
U.S. Treasury yields held near their highest levels
since November 2018.
There are several opposing catalysts at play for gold in the
likes of a tight monetary outlook driving bond yields and a
stronger dollar, and that is being pitted against stagflation
risks boosting its safe-haven status and appeal as an inflation
hedge, said Yeap Jun Rong, a market strategist at IG.
“With that, gold prices seem to be undergoing a period of
indecision until one of the driving forces take greater control
Investors are now looking to U.S. non-farm payrolls data for
April to assess its impact on monetary policy. The Fed on
Wednesday raised its benchmark rate by half a percentage point,
the most in 22 years.
“I would not be surprised to see another above-consensus
wage print, and this may not be good for bullion as the market
would read those tea leaves as a sign of improving the odds for
a 75 bp point hike at the July FOMC meeting,” said Stephen
Innes, managing partner at SPI Asset Management.
Non-yielding gold tends to fall out of favor among
investors when interest rates rise.
Equities tumbled as investors expressed concern that rising
interest rates could hurt global economic growth.
With the market back into selling everything mode, it seems
like “don’t fight the Fed is back in play,” Innes said.
Silver slipped 1% to $22.28 per ounce, platinum
slid 3% to $951.42 and palladium also fell 3% to
(Reporting by Swati Verma in Bengaluru; Editing by Vinay
Dwivedi, Uttaresh.V and Emelia Sithole-Matarise)
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