Gold prices steadied on Friday after a sharp sell-off in the previous session, as traders digested rate-hike remarks from global central banks, but the metal was set for its first weekly drop in seven amid a strong dollar.
Spot gold was up 0.1% at $1,914.33 per ounce by 0424 GMT, after shedding 2% in a sell-off on Thursday that was fueled by a firmer dollar and profit-taking.
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U.S. gold futures were little changed at $1,913.50.
“With gold prices delivering a stellar performance of more than 20% over the past three months, some positioning for softer rate-hike bets could already have been at play and having found the much-needed validation from the recent FOMC meeting,” said Yeap Jun Rong, a market analyst at IG.
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Therefore, it may trigger some near-term profit-taking, “but for gold prices, a greater conviction for sellers could be a break below the $1,895 level, where dip-buyers were seen stepping in this week just before the meeting,” the analyst added.
Bullion has gained about $300 since November on expectations of softer rate hikes from the U.S. central bank, as a lower interest rate environment reduces the opportunity cost of holding non-yielding bullion.
Following the Fed’s 25 basis-point rate increase, both the ECB and the BoE raised their rates by 50 bps as expected on Thursday.
Global central banks are now laying the groundwork in unison for a pause that, while not yet promised, is coming into view for later this year.
Bullion could range between $1,870 to $1,960 over the next two weeks, said Edward Meir, a metals analyst at Marex.
The U.S. dollar, meanwhile, was up 0.1%, keeping a leash on gold prices.
On the data front, investors are now awaiting the monthly U.S. non-farm payrolls due later in the day.
Elsewhere, spot silver rose 0.1% to $23.4954 per ounce, and palladium gained 0.51% to $1,662.60.
Platinum held steady at $1,022.40. (Reporting by Arundhati Sarkar in Bengaluru; editing by Uttaresh.V and Subhranshu Sahu)