Gold is heading for a weekly gain amid expectations of no rate hike
Gold prices fell today (Friday), after rising by more than 1 percent in the previous session, but hopes that the Federal Reserve (the US central bank) will not raise interest rates made the yellow metal heading for weekly gains.
Gold fell in spot transactions 0.2 percent to $1964.79 an ounce, but it is heading to record a weekly rise of 0.9 percent. US gold futures settled at $1979.80.
Tim Waterer, chief market analyst at KCM Trade, said that the number of Americans who filed new applications for unemployment benefits supported expectations that the US Central Bank would temporarily stop raising interest rates in June, and the resulting decline in revenues allowed The treasury increased the price of gold.
He added that a slight decline is normal after the rise in light of some profit-taking operations.
The dollar index hovered near the lows it reached in the previous session. A weaker dollar makes gold less expensive for overseas buyers.
All eyes now turn to the US Consumer Price Inflation Report for May, scheduled for release on June 13, ahead of the Central Bank’s meeting, which will provide investors with greater clarity on the strength of the world’s largest economy.
Yesterday (Thursday), the International Monetary Fund urged the Federal Reserve and other global central banks to “stay the course” on monetary policy and remain vigilant in the fight against inflation.
Higher interest rates increase the opportunity cost of holding non-yielding gold.
As for other precious metals, spot silver rose 0.4 percent to $24.3387, and palladium rose 0.3 percent to $1,365.39.
Platinum rose 0.5 percent to $ 1,015.48, heading to record gains after falling for two consecutive weeks.