Gold prices were set on Friday for a
fourth consecutive monthly drop, pressured by strong
performances in the greenback and U.S. bond yields and
aggressive monetary policies from top central banks.
Spot gold inched up 0.2% to $1,758.94 per ounce, as
of 0337 GMT. U.S. gold futures rose 0.3% to $1,775.10.
Gold remains inversely correlated to the dollar and yields,
rather than being a gold story in itself, OANDA senior analyst
Jeffrey Halley said, adding that their recent dips provided some
support to bullion this week.
The metal is set for its best week since mid-May, with
prices up 1.9% so far. However, bullion is unlikely to stave off
its worst run of monthly losses since November 2020.
The dollar has spent most of July hovering around
20-year highs, hammering demand for greenback-priced gold among
other currency holders.
The U.S. Federal Reserve on Wednesday hiked interest rates
by three-quarters of a percentage point as it attempts to fight
Benchmark U.S. 10-year Treasury yields firmed after hitting
a three-month low on Thursday. Higher rates and bond yields
increase the opportunity cost of holding non-interest bearing
“Although bullion saw a sell-off below $1,700 (earlier this
month) it is significant that long-term support at $1,675/80 was
tested and held. Gold has been trying to form a bottom since,”
helped by recent signs of a U.S. recession, Halley said.
The U.S. economy unexpectedly contracted in the second
quarter, raising risks of an economic slowdown, which lifted
gold’s safe-haven allure and helped bullion prices gain more
than 1% on Thursday.
Spot silver firmed 0.3% to $20.04 per ounce, while
platinum eased 0.2% to $886.24. Both face monthly losses.
Palladium rose 0.8% to $2,095.13, and has gained
about 8.2% this month, its best since January.
(Reporting by Bharat Govind Gautam in Bengaluru; Editing by
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