By Seher Dareen
(Reuters) – Gold prices retreated on Friday as the U.S. dollar regained ground, after the non-yielding metal posted gains in the previous three sessions on expectations the U.S. Federal Reserve would scale back its rate-hiking stance.
Spot gold fell 0.3% to $1,749.96 per ounce by 10:43 a.m. ET (1543 GMT), coming off a one-week high hit earlier in the session. U.S. gold futures was also up 0.3% to $1,750.10.
With bullion tracking the dollar and low-volume trading, “it’s not going to take much to move the market in either direction and probably going to continue to see more of the same throughout the day,” said Jim Wyckoff, senior analyst at Kitco Metals.
The dollar gained 0.3%, making greenback-priced gold more expensive for overseas buyers. [USD/]
World’s top gold consumer China on Friday reported a new daily record for COVID-19 infections, as cities across the country continued to enforce mobility measures and other curbs to control outbreaks.
“The COVID situation in China doesn’t appear to be getting any better, so that’s going to be a front burner issue for the marketplace, not only gold, but for all the markets here for the next couple of weeks,” Wyckoff highlighted.
This year’s high interest rate hikes from the U.S. Fed have kept a leash on non-yielding gold’s traditional status as a hedge against inflation and other uncertainties, with traders expecting a smaller 50 bps rate increase at the December meeting.
“With a continued lack of buying interest from ETF investor and increased competition from bonds as yields drop, a further gold extension above the important $1,800 area will likely require further declines in the yields and the dollar,” Saxo Bank analyst Ole Hansen said in a note. [GOL/ETF]
Silver dropped 0.9% to $21.31, but was up about 1.9% for the week. Spot platinum fell 1.3% to $975.00 per ounce. Palladium dipped 3.9% to $1,806.83, and was set for a weekly loss.
(Reporting by Seher Dareen in Bengaluru; Editing by Krishna Chandra Eluri)
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