Gold drops weekly on Wednesday as dollar strengthens as interest rates soar According to Reuters
© Reuters. FILE PHOTO: A jeweler wearing a protective mask arranges gold bracelets as the other talks to customers at a jewelry store in the Grand Bazaar in Istanbul, Turkey, August 6, 2020. REUTERS / Murad Sezer
By Ashitha Shivaprasad
(Reuters) – Gold fell more than 1% on Friday, setting up for a fourth straight week of losses, as a strong dollar run with stronger U.S. interest rates on the horizon dented appetite for gold.
fell 0.4% to $1,813.80 an ounce by 10:23 a.m. EDT (14:23 GMT), after touching $1,798.86, its lowest since Feb. 4. It has lost more than 3% in the past year. this week.
US fell 0.6 percent to $1,813.90.
US Federal Reserve Chairman Jerome Powell on Thursday said the fight to control inflation will “include some pain”, as the impact of higher interest rates is felt.
“Gold is being weighed down by the Fed’s pledge to raise interest rates at a fast pace and, in addition, the dollar is strengthening very strongly,” said David Meger, director of metals trading at High Ridge Futures.
“Going forward, the inflation numbers are what the market will be watching closely.”
The coin has been set for a sixth straight week of gains, hovering near a 20-year high. [USD/]
Although seen as an inflation hedge, bullion is non-yielding and very sensitive to increases in short-term interest rates and US bond yields.
“The rally in global equity markets amid less risk aversion towards the end of the trading week is also a negative for the safe-haven metal,” said Kitco senior analyst Jim Wycoff. safe”.
U.S. stock index futures rebounded before Wall Street opened, fueling fears of a bear market. [.N] [MKTS/GLOB]
Spot silver rose 1.2% to $20.90 an ounce, but has fallen more than 6% this week, its highest since late January.
Platinum fell 0.2% to $941.77. Palladium rose 1.8% to $1,942.46, after falling more than 8% on Thursday.
“Concerns about supply disruptions in Russia take precedence over the palladium market and buying activity has dropped sharply as prices have dropped significantly,” Meger added.
