The final week of March presented a flurry of optimistic US data that indicated a strong economy, thus buoying demand for dollar, and dragging gold prices on Friday.
A dominant US dollar usually weighs on gold, as it dulls the precious metal's appeal as an alternative or safe-haven asset. A stronger greenback also makes dollar-priced commodities more expensive for holders of other currencies.
Stronger US dollar, US data
However, the dollar became more vulnerable after Friday’s release of economic data, although the currency was still widely supported by previous reports and the overall optimism over the strength of the economy. The most recent upbeat reports before the today included fourth quarter gross domestic product (GDP) and initial jobless claims on Thursday, which put greenback on a bullish run.
The US Commerce Department stated that personal spending grew 0.1% in February, compared to estimates for a gain of 0.2% and after a 0.2% rise in January. Personal income, meanwhile, inched higher by 0.4% in January, coinciding with forecasts and after climbing 0.3% a month earlier.
The US dollar index was steady at 100.30 as of 13:15 GMT, straying away from its two-and-a-half week high of 100.47 hit overnight
Despite the support coming from optimistic US economic data, dollar also remained vulnerable as investors remained wary as President Donald Trump was slated later in the day to sign executive orders targeted at identifying abuses that are causing huge US trade deficits and clamping down on non-payment of anti-dumping and anti-subsidy duties on imports.
Commerce Secretary Wilbur Ross indicated that one of the orders directs a major review of the causes of US trade deficits, which includes currency misalignment.
Gold analysis, metals trading
On the Comex division of the New York Mercantile Exchange, gold futures for April delivery declined 0.41%, or $5.05 to $1,240.00 a troy ounce. Gold hit an intraday low of $1,239.26, the lowest since March 21. Previously, the April contract ended Thursday’s session 0.69% lower at $1,245.00 an ounce.
Futures for the yellow metal were likely to find support at $1,226.40, the low of March 21 and resistance at $1,253.60, which is Thursday’s high.
Elsewhere in metals trading, silver for May delivery fell 0.35% to $18.142 a troy ounce. Copper futures, meanwhile, shed 1.18% to trade at $2.640 a pound.
This is FSM News bringing you the freshest and biggest market updates. We provide in-depth analysis and detailed news stories to keep investors constantly informed in this fast-paced, dynamic industry. Read more from us and be updated!