Gold set to record worst week in three months on robust dollar
Gold prices fell over 1% on Friday as the dollar held close to two-week highs after U.S. inflation data came in line with expectations, suggesting the Federal Reserve may adopt a cautious stance on additional rate cuts.
Spot gold was down 1% at $2,846.19 an ounce by 01:44 p.m. ET (1844 GMT). Bullion has so far lost 3.1% for the week, its steepest weekly fall since November.
U.S. gold futures settled 1.6% lower at $2,848.50.
The dollar index (.DXY), was set for a weekly gain, making dollar-priced gold more expensive for overseas buyers.
Wall Street's main indexes had a subdued start as investors remain cautious over potential price pressures from President Trump's policies.
The Personal Consumption Expenditures (PCE) price index increased 0.3% in January, in line with expectations, after advancing by an unrevised 0.3% in December.
Traders of futures contracts that settle to the Federal Reserve's policy rate maintained bets on Friday that the U.S. central bank will resume cuts to short-term borrowing rates in June.
Higher interest rates dampen non-yielding bullion's appeal.
However, safe-haven gold is set for a second consecutive monthly gain, boosted broadly by concerns over Trump's tariff plans.
Trump said on Thursday his proposed 25% tariffs on Mexican and Canadian goods will take effect on March 4, with an extra 10% duty on Chinese imports.
Spot silver fell 0.8% to $31, platinum lost 1.1% to $938.50 and palladium slipped 0.6% to $914. All three metals' prices looked set for monthly declines.
Source : Reuters
