Gold poised for fourth weekly loss on hawkish Fed bets
Gold was set for a fourth straight weekly fall on Friday, as a resilient dollar and expectations of faster U.S. rate hikes to tame inflation kept bullion pressured below $4,000 per ounce.
Spot gold fell 0.9% to $3,991.49 per ounce by 0247 GMT. U.S. gold futures for August delivery lost 1% to $4,007.30.
For the week, bullion was on track for a loss of 4%, having slipped below the key $4,000 level for the first time since November 2025 on Wednesday.
"The rapid repricing of the hawkish Fed created a strong bullish momentum in the U.S. dollar, which eventually led to this significant downward drift in gold prices," said Kelvin Wong, a senior market analyst at OANDA.
The U.S. dollar index held near its strongest level since May 2025 and was headed for a second straight weekly gain, making gold more expensive for holders of other currencies. [USD/]
Wong sees the multi-month correction in gold, since the record high reached in late January, extending towards $3,400 in the long term.
Gold prices have fallen about 29% from the record high of $5,594.82 on January 29, as inflation fuelled by the U.S.-Iran war ramped up rate-hike bets.
Data on Thursday showed that U.S. inflation increased further in May, breaking above 4.0% for the first time in three years, as forecast by economists surveyed by Reuters.
Although gold is typically viewed as a hedge against inflation, it tends to lose its appeal as a non-yielding asset in a high-interest-rate environment.
Traders expect three Fed rate hikes this year and are pricing in about a 64% chance of a September increase, according to the CME FedWatch Tool. [FEDWATCH/]
Among other metals, spot silver fell 3.2% to $56.01 per ounce, platinum lost 2.4% to $1,563.20, and palladium slid 1.6% to $1,165.93. All metals were headed for a weekly loss.
