23 Jun 2023 , 10:47 AM
As the likelihood of further interest rate increases by the U.S. Federal Reserve this year impacted on the attraction of metal, gold prices on Friday were on course for their worst weekly decline since February.
Spot gold was up 0.1% at $1,915.39 per ounce, but it was still trading near a three-month low. American gold futures were stable at $1,925.10.
Bullion, meanwhile, experienced a 2.2% weekly decline.
The dollar index remained stable and is expected to increase weekly, which makes gold less appealing to foreign investors.
On the second day of his testimony, Fed Chair Jerome Powell stated that the U.S. central bank would raise interest rates going forward at a ‘careful pace’ as decision-makers approach the end of their historic cycle of tightening monetary policy.
In a separate statement, Fed Governor Michelle Bowman stated that ‘additional policy rate increases’ will be required to keep inflation under control.
After the U.S. central bank kept interest rates unchanged at its June meeting, investors now anticipate that rate increases will resume in July.
In the meantime, U.S. unemployment claims remained stable at a 20-month high last week, possibly indicating a deteriorating labour market in response to the Fed’s brisk rate hikes.
Furthermore, according to data released on Friday, Japan’s core consumer prices increased 3.2% in May from a year earlier, while service sector growth slowed for the first time in seven months and manufacturing activity resumed contracting in June.
Spot silver decreased by 0.1% and platinum decreased by 0.1% to each be at $22.2223 and $921.88, respectively. Palladium held steady at $1,284.36 after falling as low as it has in a session since May 2019.
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