Gold prices tread water ahead of G7, U.S. Fed meetings
BENGALURU (Reuters) – Gold prices held steady on Friday as investors remained cautious ahead of a G7 meeting starting later in the day and other key events next week such as a United States Federal Reserve policy meeting and a U.S.-North Korea summit.
Gold bars are displayed at South Africa’s Rand Refinery in Germiston, file. REUTERS/Siphiwe Sibeko/File Photo
Spot gold was steady at $1,296.36 per ounce by 0415 GMT. It hit a one-week high of $1,303.08 an ounce in the previous session and has risen about 0.3 percent for the week so far.
U.S. gold futures for August delivery fell 0.2 percent to $1,300.40 per ounce.
“Gold is most likely going to be range bound. The markets are looking very closely on what could actually come out from the G7 meeting,” said OCBC analyst Barnabas Gan.
Leaders of the Group of Seven rich nations headed for a summit in Canada on Thursday more divided than at any time in the group’s 42-year history, as U.S. President Donald Trump’s “America First” policies risk causing a global trade war and deep diplomatic schisms.
President Donald Trump is set to meet North Korean leader Kim Jong Un on June 12 in Singapore, and the U.S. Federal Reserve’s Federal Open Market Committee (FOMC) starts its two-day meeting on interest rates on the same day.
The number of Americans filing for unemployment benefits unexpectedly fell last week, pointing to a further tightening in labour market conditions and strengthening prospects of an interest rate hike.
“The market is also looking for a potential rate hike by the FOMC … (but) the dollar movement will dictate how gold will move into the next one week or so,” Gan added.
Gold is highly-sensitive to rising U.S. rates as these tend to boost the dollar, putting pressure on greenback-denominated, non-yielding bullion.
The dollar index, which measures the greenback against a basket of six major currencies, was up 0.1 percent at 93.458. It fell to a three-week low in the previous session. [USD/]
In other precious metals, spot silver fell 0.1 percent to $16.64 an ounce, after marking an over 6-week high on Thursday. It was heading for a nearly 2 percent rise this week, its biggest in seven weeks.
Palladium was little changed at $1,012 per ounce. It had also risen to an over 6-week high in the previous session and was on course for its third consecutive weekly gain this week, up over 1 percent so far.
Platinum was down 0.3 percent at $894.20 an ounce and was on course for a small weekly decline.
Reporting by Karen Rodrigues in Bengaluru; Editing by Joseph Radford
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