In recent news, Gold just reached its 3-week low in early trades of Friday as the positive US Economic Data backed the dollar up.
The index of dollar stabled as the economic data of the US Employment benefits declined beyond than the expected.
The strong economic data can possibly galvanize the US Federal Reserve to raise up the interest rate for a fourth time this year.
"The strengthening of the dollar (is weighing on gold)... and after the latest Fed interest rate hike people are waiting to see when the Fed will raise rates next," managing director of gold dealer GoldSilver Central in Singapore, Brian Lan told reports.
Greater interest rates do tend to increase the dollar value which in result – pressures gold rates by putting more opportunity cost of holding non-acquiescent gold bars.
At the time of writing, spot gold barely moved at $1,256.56 for an ounce. In early trades, the commodity reached a high of $1,257.04 and a low of $1,251.08. In a weekly perspective, the gold declined 1%.
For August distribution, US gold futures climbed 0.1 per cent to $1,256.4.
"The fact that the dollar is nudging higher, should continue to pressure the market, while the churn in US equities is still not serious enough to warrant a flight to safety into the precious metal," analyst Edward Meir, specified.
"We think gold will likely have another $20-$25 on the downside before encountering more serious support." Meir added.
For the time being, SPDR Gold Trust Holdings – a globally renowned gold-backed exchange trade fund declined 0.14 per cent to 853.68 tons.
Precious Metals’ Decline
As for the other traded metals, spot silver is also close to facing its 6-week low soon. The commodity added 0.5 % to $16.84 for every ounce, following a hit $16.64 in the preceding period - its most fragile ever since May 19.
"Price action in both gold and silver of late seems to imply that traders still have plenty of short-term long positioning on their books," Senior market analyst Jeffrey Halley told reports.
"It may leave both metals vulnerable to a further washout into the weekend if the US dollar strength persists." Halley added.
On Thursday, Platinum declined 0.2 per cent to $917.60 for each ounce - it’s lowest in beyond one month.
In the meantime, palladium plunged 0.6 per cent to $864.05 for each ounce, as it stirred to its major weekly weakening in weeks.
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