Gold Up, but Set for Weekly Fall as Fed Preps to Begin Tapering

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(C) Reuters.

By Gina Lee

Investing.com – Gold was up on Friday morning in Asia, recovering from a more than 1% fall during the previous session. A dollar near a one-week low gave the yellow metal a boost, although the U.S. Federal Reserve’s plans to begin asset tapering quicker than planned kept it on track for a third consecutive week of declines.

Gold futures inched up 0.13% to $1,752.15 by 12:10 PM ET (4:10 AM GMT), after hitting $1737.46, its lowest level since Aug. 11, on Thursday, but was down 0.4% for the week.

The dollar, which normally moves inversely to gold, inched up on Friday but remained near the one-week low that it hit the day before.

The Bank of England and Norges Bank handed down their respective policy decisions on Thursday. While the former kept its interest rate unchanged at 0.10%, the latter raised its interest rate to 0.25% from the previous month’s 0%.

The Fed said that it would likely begin asset tapering within 2021 and hike interest rates in 2022 when it handed down its latest policy decision a day earlier.

On the data front, Japanese data released earlier in the day said that the national core consumer price index (CPI) grew 0% year-on-year in August. The national CPI contracted 0.4% year-on-year and 0.2% month-on-month respectively. The manufacturing purchasing managers index (PMI) for September was 51.2.

In other precious metals, silver gained 0.5% to $22.61 per ounce and is up 1% for the week so far. Palladium rose 0.5% to $1,992.67 but was set for a third consecutive week of declines. Platinum fell 0.8% to $980.67 but was headed for a 4.3% weekly gain, its biggest in six weeks.

Gold Up, but Set for Weekly Fall as Fed Preps to Begin Tapering

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