Gold prices inch higher as dollar softens; set for weekly loss


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Gold firmed on Friday as the dollar came

slightly off two-decade highs, but bullion was set to post its

biggest weekly drop in more than a month as the elevated

greenback hit demand.

FUNDAMENTALS

* Spot gold firmed 0.3% to $1,744.07 per ounce by

0106 GMT. U.S. gold futures rose 0.2% to $1,742.50.

* The dollar edged down from 20-year highs, taking some

weight off greenback-priced gold.

* Gold prices have lost about 3.7% this week. It is likely

to be their fourth straight weekly fall, and worst since

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mid-May.

* U.S. equities rose with Treasury yields overnight, as

investors bet on economic light at the end of the Federal

Reserve’s rate hiking tunnel, while oil prices rose on supply

concerns.

* Benchmark U.S. 10-year Treasury yields dipped on Friday,

buoying gold.

* The number of Americans filing new claims for unemployment

benefits unexpectedly rose last week and there are growing signs

that demand for labor is cooling, with layoffs surging to a

16-month high in June, as the Federal Reserve’s aggressive

monetary policy tightening stokes recession fears.

* Two of the Fed’s most vocal hawks on Thursday said they

would support another 75 basis-point interest rate increase

later this month but a downshift to a slower pace afterward,

even as both downplayed the risk of higher borrowing costs

pushing the U.S into recession.

* Rising short-term U.S. interest rates and bond yields

increase the opportunity cost of holding gold, which yields no

interest.

* Spot silver rose 0.5% to $19.28 per ounce, and

platinum gained 0.6% to $878.40, but both were set for

weekly losses.

* Palladium climbed 0.8% to $2,006.51, and has gained

about 2.3% for the week.

DATA/EVENTS (GMT, June)

1230 US Non-Farm Payrolls

1230 US Unemployment Rate

1230 US Average Earnings YY

(Reporting by Bharat Govind Gautam in Bengaluru; Editing by

Rashmi Aich)



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