Gold prices remain flat in early trading today

10 Feb 2023 , 09:18 AM

As  US Federal Reserve showed signs of easing of its hawkishness on inflation, gold prices were flat on Friday and were on track for their second consecutive weekly loss.

Spot gold was unchanged at $1,861.11 per ounce. The metal was down 0.2% for the week as a whole. Futures for U.S. gold decreased 0.3% to $1,873.00.

The dollar index increased by 0.1% and was on track to post weekly gains. 

According to Thomas Barkin, president of the Richmond Fed, tight monetary policy is ‘unmistakably’ slowing the U.S. economy, enabling the Federal Reserve to act ‘more cautiously’ with any future interest rate hikes.

Higher rates reduce the appeal of bullion, which pays no interest, despite the fact that gold is regarded as a hedge against inflation.

According to data released on Thursday, more Americans than anticipated renewed their claims for unemployment benefits last week, although they did so at levels consistent with a tight labour market.

Market investors now anticipate that the Fed’s target rate, which is now fluctuating between 4.5% and 4.75%, will peak at 5.153% in July.

A week after the BoE hinted its string of rate hikes might be reaching its pinnacle, policymakers of the Bank of England clashed on Thursday about how high interest rates should be to control inflation. Governor Andrew Bailey emphasised the unpredictability of the forecast.

Spot silver prices dropped by 0.3% to $21.91 an ounce, platinum prices dropped by 0.1% to $953.28, while palladium prices dropped by 0.5% to $1,637.79.

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