Gold prices dip, set for 2% weekly loss amid hawkish Fedspeak
Investing.com-- Gold prices fell slightly on Friday and were set for steep weekly losses after a string of hawkish comments from Federal Reserve officials saw markets rethink bets for a pause in more interest rate hikes.
Diminishing safe haven demand, in the face of waning concerns over the Israel-Hamas war, also kept appetite for gold largely muted.
After a 10% jump in October, gold prices were hit with a heavy degree of profit taking in early-November, pulling the yellow metal to over three-week lows this week. But prices still remained around the mid-$1900 mark.
Spot gold fell 0.1% to $1,957.01 an ounce, while gold futures expiring in December fell 0.4% to $1,961.90 an ounce by 00:11 ET (05:11 GMT). Both instruments were set to lose about 2% this week- their worst week since late-September.
Still, gold prices had seen some gains on Thursday after a disappointing Treasury auction spurred more selling in government bonds, with some traders pivoting into gold. But a corresponding spike in Treasury yields kept any gains in gold limited.
The dollar rebounded from six-week lows this week, following a string of hawkish comments from Fed officials. Chair Jerome Powell warned on Thursday that the Fed remained unconvinced that monetary policy remained sufficiently restrictive, and also warned that sticky inflation could invite more rate hikes.
His comments came on the heels of several similar comments from other Fed officials, which had chipped away at gold prices through the week.
Expectations for an end to the Fed’s rate hike cycle rose substantially last week after traders interpreted Powell’s comments at a meeting as seemingly less hawkish. While a bulk of these bets still persisted, markets now grew less confident
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