Gold set for biggest weekly loss since August … RTRS
Gold set for biggest weekly loss since August as dollar weighs
* Gold prices were on track to post its biggest weekly fall since August.
* Meanwhile, silver was also headed for its biggest weekly fall since Sept. 7.
* The moves came after the Federal Reserve kept interest rates steady on Thursday but reaffirmed its monetary tightening stance.
Gold prices fell to their lowest in a week on Friday, and were set for their biggest weekly fall since August, on a firmer dollar as the U.S. Federal Reserve indicated they
will continue to raise interest rates, lowering demand for bullion.
Spot gold fell 0.4 percent to $1,218.23 per ounce at 0357 GMT, having touched its lowest level since Nov. 1 at $1,218.08.
Gold was down 1.2 percent for the week, its biggest weekly decline since the week of Aug. 17.
U.S. gold futures fell 0.3 percent to $1,221.70 per ounce.
“Gold has come under pressure because of a stronger dollar. Also the FOMC meeting showed no change in the interest rates. Market sentiment from here could be bearish for gold,” said Peter Fung, head of dealing
at Wing Fung Precious Metals in Hong Kong.
The dollar gained against its major peers on Friday as the Fed on Thursday kept interest rates steady but reaffirmed its monetary tightening stance.
Higher interest rates raise the opportunity costs of holding gold, which does not pay interest and incurs costs to store and insure.
The dollar index, which measures the greenback against a basket of six major currencies, climbed about 0.8 percent in the previous session.
“We remain cautious on gold here as roughly half the recent advance seems to have been rolled back in recent days on account of a stronger dollar and more resiliency in U.S. equity markets,” said INTL FCStone
analyst Edward Meir in a note.
“In addition, U.S. interest rates seem to be on the march again… there is not much of an upside trigger that could lead to a sustainable rally.”
The Fed has hiked rates three times this year and is widely expected to do so again in December because of a robust U.S. economy, rising inflation and solid jobs growth.
Spot gold is expected to test a support at $1,211 an ounce, with a good chance of breaking below this level and falling more to $1,202, said Reuters technical analyst Wang Tao.
Among other precious metals, silver fell 0.6 percent to $14.32 per ounce. The metal was headed for its biggest weekly percentage decline in nine weeks, slipping about 2 percent so far.
Platinum dipped 1.2 percent to $853.45 an ounce, its lowest level in a week. The metal was down about 1 percent so far for the week, its biggest fall since late September.
Palladium was down about 0.3 percent to $1,120.60 per ounce, though it was up 0.6 percent for the week, set for its fourth weekly gain.