Gold Futures Settle Lower For The Day, Sheds More Than 2% In Week

Gold futures settled lower on Friday as the dollar stayed fairly steady amid concerns over higher interest rates and rising geopolitical tensions in Ukraine.

The promise of an aggressive Fed rate rise campaign to combat persistently high inflation also boosted demand for the dollar.

However, the dollar’s retreat from higher levels helped limit gold’s losses. The dollar index, which advanced to 97.44 in the European session, dropped to 97.06 around noon before recovering some lost ground. It was last seen at 97.22, down marginallly from the previous close.

Gold futures for April ended lower by $8.40 or about 0.5% at $1,786.60 an ounce. Gold futures shed more than 2% in the week.

Silver futures for March ended down by $0.375 at $22.301 an ounce, while Copper futures for March settled at $4.3100 per pound, down $0.1135 from the previous close.

Traders are currently pricing in nearly five rate hikes this year, staring with the March meeting, in the wake of Fed Chair Jerome Powell’s hawkish remarks on Wednesday.

Powell said there is “quite a bit of room to raise interest rates without threatening the labor market that is by so many measures historically tight.”

A report from the Commerce Department showed core consumer price growth accelerated to a nearly 40-year high in December.

The Commerce Department’s reading on inflation, which is said to be preferred by the Federal Reserve, showed the annual rate of core consumer price growth accelerated to 4.9% in December, reaching the highest level since September 1983.

At the same time, the report also showed personal spending fell by 0.6% in December after rising by 0.4% in November. The decrease in spending matched economist estimates.

Excluding price changes, real personal spending tumbled by 1% in December after slipping by 0.2% in the previous month.

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