Gold prices continue to fall

Gold fell on Friday and was on track for its first weekly decline, its worst since November, on growing expectations of a US rate hike as early as this month.
Spot gold dropped 0.3 percent to $1,231.31 per ounce at 0730 GMT, after hitting a low of $1,229.05 earlier in the session. The metal has lost nearly 2.3 percent so far this week. US gold futures fell 0.1 percent to $1,231. Increasing chances of a rate hike should keep a lid on any gold rallies leading into the March meeting, MKS PAMP Group trader Sam Laughlin said.
“With (US Federal Reserve) President Janet Yellen on the wires tonight, we look to see further weakness across the precious complex should she, as expected, promote the potential for an interest rate increase in March,” Laughlin said.
“Initial support for gold sits around $1,230, while below this we look to the 100-day moving average at $1,210.” Yellen and Fed Vice Chair Stanley Fischer are both due to speak later on Friday.
The number of Americans filing for unemployment benefits fell to near a 44-year low last week, pointing to further tightening of the labor market even as economic growth appears to have remained moderate in the first quarter.
A surge in business and consumer confidence during President Donald Trump’s first weeks in office has helped push the Fed toward its first sustained series of interest rate hikes in more than a decade, despite a dearth of firm policies from the administration.
Spot gold may temporarily hover above a support at $1,232 per ounce and then bounce toward a resistance at $1,241 before falling again, according to Reuters technical analyst Wang Tao. A correction in gold, however, is likely to be shallow, as investors remained friendly to bullion as a hedge against global uncertainty and rising inflation, analysts said.
ABN Amro lifted its year-end 2017 gold price forecast by $200 to $1,300 on Thursday, while Commerzbank said any setbacks to prices should be limited and short-lived due to uncertainty over Trump’s policies and European elections.
Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.21 percent to 845.32 tons on Thursday from Wednesday. Spot silver held firm at $17.78, after falling 3.5 percent to hit a three-week low of $17.64 on Thursday. The metal had its worst one-day fall since Dec. 15. It is on track to end the week down 3 percent, its worst since December. Platinum was steady at $987, after falling 3 percent in the previous session to hit a one-month low of $978.75. Palladium rose 0.1 percent to $768.75.

Source: Arab News