The gold market appears to be weighing two different things at the moment, said Craig Erlam, a senior market analyst at OANDA.
On the one hand, US economic data suggests lower inflation giving the Fed room to slow tightening, which should help gold, while, on the other hand, there is a cautious US central bank that does not want to change the tone of its message based on a single economic data, Erlam said.
Although the gold metal has lost 15% since its March peak after the Fed began to tighten, it has gained 8% since early November as markets began to anticipate a slower pace of hikes.
The dollar index fell, making bullion cheaper for foreign buyers. However, the currency was headed for a weekly rise as remarks from the Fed authorities halted a pullback triggered by weaker inflation data from last week.
In other precious metals, Spot silver gains 1.3% to $21.21 the ounce; palladium falls 1.2%, to u$s1,981.23; and the platinum adds 0.2%, au$s982.50, but it was heading for its biggest weekly decline since September.
Source: Ambito
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