Posted 25th March 2024

Gold Price News: Gold Drifts Lower As US Dollar Strengthens

Gold prices drifted a few dollars lower on Friday to cap a volatile week in which prices hit fresh all-time highs, only to fall back to pare the gains.

Prices eased to around $2,160 an ounce by Friday afternoon, down from around $2,182 an ounce in late deals on Thursday, and marked a second straight day of losses.

Kinesis gold KAU ($/g) – from Kinesis Exchange

The US dollar strengthened on Thursday and Friday, reaching a three-week high against the euro, putting downward pressure on dollar-denominated gold prices.

In general, a more cautious mood prevailed at the end of the week, following gold’s surge to a new all-time high of $2,223 an ounce on Wednesday. The probability and timing of potential interest rate cuts continues to be a major driver for the gold market, with economic data pushing prices in either direction as the markets mulled the chances of a first cut to US interest rates in June.

The Swiss National Bank’s unexpected decision this week to cut rates was a contributor to the US dollar’s strength, as it raised bets that other central banks could start to loosen monetary policy ahead of the US.

Looking ahead, Monday will see speeches by ECB President Christine Lagarde as well as from US Fed officials, potentially offering further clues on the outlook for interest rates going forward.

Then on Tuesday, the markets will get an update on monthly US Durable Goods Orders for February for the latest snapshot on the health of the US economy.

Frank’s experience covering the commodities markets spans 22 years, with a particular specialism in metals, carbon and energy markets. He has worked as a senior editor for S&P Global Commodity Insights (formerly Platts) and before this, at ICIS-LOR, a part of Reed Business Information (Reed Elsevier), where he covered the petrochemicals markets from 2003 to 2005.

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