Gold holds near 1-week high on struggling U.S. dollar
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Gold prices firmed near a more than one-week high on Friday, supported by a retreating U.S. dollar and lower Treasury yields as markets awaited economic data to gauge the pace of upcoming U.S. rate increases.
Spot gold rose 0.1% to $1,823.28 per ounce by 1100 GMT, after earlier reaching a week's high of $1,828.92. U.S. gold futures rose 0.1% to $1,822.80.
Bullion has risen by about 1.5% so far this week, the most since the week of Nov. 12.
"The fact that the U.S. inflation numbers weren't as high as people were thinking, might be in gold's favour," said Michael Hewson, chief market analyst at CMC Markets UK, adding that a weaker dollar and falling yields for the week have helped push gold higher.
The big test would be whether gold can move above the December peaks around the $1,830-$1,835 levels "because that has proved to be a little bit of a tough nut to crack earlier this month," Hewson said.
The dollar fell to its lowest in more than two months, while the benchmark U.S. 10-year Treasury yields face their first weekly dip in four. [USD/][US/]
Investors await U.S. economic data including retail sales later in the day, after the December CPI data came in line with expectations.
Non-yielding bullion is considered an inflationary hedge. It also benefits from dollar weakness that makes it cheaper for holders of other currencies.
"If gold doesn't find the strength to break through $1,830, the price could continue its sideways dance between $1,800 and $1,830 seen in the last few days," Carlo Alberto De Casa, market analyst at Kinesis, wrote in a note.
Spot silver rose 0.2% to $23.11 an ounce, and was en route to its best week in two months.
Platinum was up 0.6% to $975.50 and was set to gain this week, while palladium fell 0.9% to $1,871.68, poised for a weekly drop.
