Gold prices fell slightly on Friday (December 19), pressured by a stronger dollar and year-end investor positioning, but are poised to end the week higher as weaker US inflation data raised speculation of an interest rate cut.
Spot gold prices fell 0.1% to $4,326.29 an ounce at 09:35 GMT, but are expected to post a weekly gain of 0.6%, having returned to near the record high reached in October. US gold futures fell 0.2% to $4,354.80.
Spot silver prices rose 0.7% to $65.90 an ounce, expected to end the week up 6% after hitting an all-time high of $66.88 on Wednesday.
Silver has risen 128% year-to-date on stronger industrial demand and has outperformed gold, which has posted a 65% annual gain so far this year.
The US dollar rose to its highest level in more than a week, making US dollar-priced bullion more expensive for holders of other currencies.
"Gold is under some pressure today, likely due to some year-end positioning adjustments and a calm atmosphere ahead of the holidays," said Zain Vawda, an analyst at MarketPulse by OANDA, adding that recent weaker US economic data has helped the outlook for interest rate cuts next year.
US consumer prices rose 2.7% year-on-year in November, below economists' forecasts of 3.1%. Federal Reserve Bank of Chicago President Austan Goolsbee said on Thursday that if lower-than-expected inflation figures can be sustained, it could open the door to more interest rate cuts next year.
Federal funds rate futures indicated a slight increase in the chances of the Fed cutting rates at its January meeting following the data.
Goldman Sachs expects gold prices to rise 14% to $4,900/oz by December 2026 in its base case, driven by structurally strong central bank demand and cyclical support from Fed rate cuts, the brokerage firm said in a note on Thursday.
Platinum rose 1.5% to $1,944.71 after hitting a more than 17-year high on Thursday. Palladium fell 0.1% to $1,694.75 after hitting a nearly three-year high earlier in the session.
Both are expected to post weekly gains, with palladium on track for its best week since September 2024. (alg)
Source: Reuters.com
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