Gold prices rose on Friday but a more hawkish stance of U.S. Federal Reserve officials on stimulus tapering and interest rate rises kept the metal, seen as an inflation hedge, on course for a third straight weekly drop.
Gold prices steadied on Monday as concerns over the impact of the Omicron coronavirus variant offset a stronger dollar, with investors assessing whether the emergence of the variant could change the U.S. Federal Reserve’s more hawkish stance.
Gold prices eased on Friday due to a firmer dollar but were on track for their biggest weekly gain in six months as concerns over soaring U.S. consumer prices boosted the metal’s appeal as an inflation hedge.
Spot gold fell 0.2% to $1,857.84 per ounce by 0625 GMT, after hitting a five-month peak on Wednesday. U.S. gold futures eased 0.1% to $1,861.30.
Gold prices edged up on Thursday, recovering from a three-week low in the last session as investors took solace in the U.S. Federal Reserve saying it would not rush into hiking interest rates even as it begins tapering its stimulus. Spot gold rose 0.3% to $1,775.00 per ounce by 0419 GMT, after touching its lowest since Oct. 13 on Wednesday. U.S. gold futures gained 0.7% to $1,775.40.
Gold prices eased on Wednesday as traders cautiously awaited the outcome of the U.S. Federal Reserve policy meeting where the central bank is likely to announce tapering of its economic support and also address growing inflationary risks. Gold is traditionally viewed as a hedge against inflation, but reduced stimulus and interest rate hikes tend to push government bond yields up, raising the opportunity cost of holding bullion, which pays no interest.