On Friday, the precious safe-haven gold futures’ prices edged lower as American currency shot up following release of a 12-year peak manufacturing PMI (Purchasing Managers’ Index) during first half of May, however, the bullion had notched a third straight weekly percentage gain, mostly riding over the back of a weakening US Dollar earlier this week.
In point of fact, spot gold futures’ prices scaled higher earlier in the week amid a growing uncertainty over April FOMC minutes, however, as US Dollar scaled higher after US Fed’s signal of a plausible alteration in fiscal policy, the bullion appeared to have lost its safe-haven bid, eventually leading to an uprising in US Dollar after hitting a 3-1/2 month low earlier this week.
In tandem, Wednesday’s FOMC minutes had shown that a number of US Federal Reserve policymakers had been prepared to taper fiscal support for the economy, as latest US economic data had shown an abrupt spike in Consumers Prices Index with a strong build-up in underlying price pressures, spurring up inflation jitters further that bode well for the greenback.
However, a stubborn stance of US Fed Chair Powell to cling on to an accommodative monetary policy despite an inflation-surge, had kept a lid on the losses for the safe-haven yellow metal.
Gold inches lower, but notches third straight weekly gain
Citing statistics, in the day’s commodity market wind down, spot gold futures’ prices edged 0.1 per cent lower to $1,876.43, mostly aided by an ease-off of US Treasury Yields with 10-year Treasury bond notes hovering at 1.62 per cent, down from a 1.69 per cent reached shortly after Wednesday’s FOMC minutes, while US gold futures’ prices ended 0.3 per cent lower to $1,830.70.
On the week, spot gold futures had shelved a 1.9 per cent in weekly percentage gain. Meanwhile, referring to an earlier-than-anticipated policy shift from the US Federal Reserve, a director of metals trading at High Ridge Futures, David Meger said, “Strong economic data like the PMI does potentially have the opportunity to cause some short-term ripples in the gold market, based on the premise that the Federal Reserve could potentially reduce bond buying quicker than anticipated”.
Among other precious metals, palladium futures’ prices were foundered as much as 2.5 per cent to $2,781.54 an ounce and reported its steepest weekly plunge since late-January, while platinum and silver contracts eased 2.3 per cent and 1.1 per cent respectively to $1,169.05 an ounce and $27.44 per ounce.