Gold prices declined on Friday to tally a loss for the week, as a stronger U.S. dollar took some of the shine off the yellow metal, prompting some analysts to speculate about an end — or perhaps a pause — for what has been a multimonth rally.
Price action
-
Gold for June delivery
GC00,
-0.24% GCM23,
-0.24%
edged down by 70 cents, or less than 0.1%, to settle at $2,019.80 per ounce on Comex, with prices for the most-active contract down nearly 0.3% from the week-ago settlement, according to Dow Jones Market Data. -
July silver
SI00,
-1.20% SIN23,
-1.20%
fell by 27 cents, or 1.1%, to $24.15 per ounce, the lowest most-active contract finish since April 3. It was almost 6.9% % lower for the week — the worst week since October. -
Palladium for June delivery
PAM23,
-3.25%
lost $40.20, or 2.6%, to $1,513.80 per ounce, tracking on 1.8% for the week, while platinum for July
PLN23,
-4.24%
declined by $38, or 3.4%, to $1,067 per ounce, posting a weekly loss of 0.1%. -
Copper prices for July
HGN23,
+0.42%
gained 2 cents, or 0.5%, to $3.73 per pound, but lost 4% for the week.
Market drivers
Gold has declined in part due to gains in the ICE U.S. dollar index
DXY,
this week. The gauge is a closely followed measure of the greenback’s value against other major currencies. The index was up 0.6% at 102.67 in Friday dealings.
“In what’s set to be the U.S. dollar index’s best week since February, bullion bulls were discouraged from drawing further conviction” from the softer-than-expected U.S. consumer price index and producer price index readings, Han Tan, chief market analyst at Exinity Group, told MarketWatch. “Gold’s upside may have also
been capped by the still-hawkish rhetoric out of this week’s [Federal Reserve] speak.”
Even so, spot gold prices remain supported above the psychologically important $2,000 level by “persistent anxiety over ongoing U.S. debt-ceiling talks as well as hopes that the Fed is done with its rate hikes,” said Tan. The longer spot gold can keep its head above $2,000 while attracting sustained inflows into bullion-backed
ETFs, “the greater the chances of the precious metal revisiting its all-time high.”
Gold futures on May 4 settled at $2,055.70, the second-highest finish for a most-active Comex contract on record.
Silver futures, meanwhile, marked another settlement at their lowest since early April.
Prices for the metal marked a sharp decline Thursday, dropping 4.8% for the biggest daily percentage loss since early February, with some analysts attributing the decline to concerns about demand from China.
Read: Silver, copper futures drop on Thursday after ‘benign’ China inflation data
However, Keith Weiner, chief executive officer and founder of Monetary Metals, told MarketWatch late Thursday that the silver fundamentals as measured by market spreads have not changed.
The “macro picture of dollar debasement and rising banking system risk” have also not changed, he said. “People are turning to gold and silver because they are what you own when you don’t want to risk investing or speculating.”
Thursday’s “hot news items” included lots of “deflationary” themes such as the banking crisis, currency crises in places like Argentina, and cooling inflation, he said. “There was a general sell off of almost everything. One of those things that happens. Could even extend for a few days, or not.”
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