Gold pressured by firm dollar, higher yields as traders seek Fed clues
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Gold prices were steady on Friday with a stronger dollar and higher Treasury yields curbing gains, as investors looked ahead to next week's U.S. inflation reading for clues on when the Federal Reserve could begin cutting rates.
Spot gold was at $2,032.44 per ounce at 1058 GMT, with prices down 0.3% over the week. U.S. gold futures were also unchanged at $2,047.10 per ounce.
The dollar index inched up 0.1% and remained on track for a weekly rise, making gold more expensive for holders of other currencies, while the U.S. 10-year Treasury yield also edged higher. [USD/][US/]
Jigar Trivedi, a senior analyst at Reliance Securities, said that Fed Chair Jerome Powell's recent comments had reduced the probability of an interest rate cut in March, putting a cap on gold prices.
After several Fed policymakers this week said they would wait to cut rates until they were more confident that inflation would fall to 2%, all eyes will be on Tuesday's U.S. consumer price index report.
Traders now see about a 61% chance of an interest rate cut in May, according to the CME Fedwatch tool. Lower interest rates decrease the opportunity cost of holding non-yielding bullion.
Elsewhere, palladium fell 1% to $877.81 per ounce and platinum was down 0.3% to $881.17. Prices of both metals were heading for a second weekly dip.
Prices of auto-catalyst metal palladium fell below those of platinum for the first time since April 2018 on Thursday.
"Challenging supply backdrop, heavy platinum loadings and substitution away from palladium are boding well for platinum," analysts at ANZ Research wrote in a note.
Spot silver rose 0.3% to $22.63.
