Gold gives up some gains on Friday but ends week higher
Gold prices pulled back from three-week highs on Friday as the dollar rebounded against a currency basket, but losses were held in check as the dollar remained near multi-year lows. Gold futures for April delivery settled down 0.41% at $1,349.70 on the Comex division of the New York Mercantile Exchange after hitting the highest level since January 25 at $1,364.40 earlier. For the week, prices were up 3.08% and remain near their highest level since August 2016.
A stronger dollar makes gold more expensive for overseas buyers. The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was up 0.63% to 89.03 in late trade, having earlier sunk to a three year low of 88.15. For the week, the index was down 1.46%, marking its fifth weekly decline in the past seven weeks.
Although gold struggles to compete with yield-bearing assets such as Treasury’s when borrowing costs rise, some analysts said the factors that drove the uptick in inflation were cyclical, meaning growth in inflation is likely to be gradual.
Elsewhere in precious metals trading, silver dropped 1.17% to $16.60 a troy ounce, but ended the week with gains of 1.78%.
Platinum settled at $1,008.80, up 0.77% for the day and was up 4.19% for the week.
Among base metals, copper for March delivery was down 0.2% at $3.239 in late trade. Trade remained subdued amid the Chinese Lunar New Year holiday. China is the world’s largest consumer of industrial metals.
In the week ahead, investors will focus on minutes of the Fed’s latest policy meeting with hopes the central bank will give more hints on the pace of future rate hikes this year.