Gold futures edged higher on Friday and scored their biggest monthly percentage gain in three years following a climb to a nearly six-year higher earlier in the week.
"Gold has surged over the past month as the [U.S. Federal Reserve's] amazing turn from hawks at the beginning of the year to doves today has finally shifted investor expectations," said Brien Lundin, editor of Gold Newsletter. "Investors have finally realized that we'll have ultra-low to negative real rates for long into the future, which is an extremely bullish tailwind for gold."
August gold GCQ19, +0.04% rose $1.70, or 0.1%, to settle at $1,413.70 an ounce. Prices had settled at $1,418.70 Tuesday before pulling back. That was the highest settlement for a most-active contract since Aug. 28, 2013, according to FactSet data.
Gold saw a roughly 1% gain for the week, up 7.7% for June, according to FactSet data. The monthly rise was the largest for a most-active contract since June 2016. For the quarter, prices rose more than 8%.
Read: Why gold prices have climbed to their highest since 2013
The impending sideline meetings at the Group of 20 conference in Japan between U.S. President Donald Trump and his Chinese counterpart Xi Jinping held the attention of financial markets Friday, as uncertainty around the trade standoff had been supportive for haven gold in recent sessions. Trump and Xi will likely use the G-20 meeting this weekend to "press pause" on their continuing trade war, but uncertainties persist, analysts have said.
Gold saw some "rebalancing," given the holiday-shortened trading week next week, which is also full of "upcoming headlines" with Trump and Xi set to meet Saturday, said George Gero, managing director at RBC Wealth Management. He also noted that international investors are also dealing with "global worries, [a] global pullback in economies and 22 countries or more having lower interest rates, so U.S. investments are the haven, with gold as a hedge."
U.S. benchmark stock indexes traded higher as gold futures settled, but looked to end the week lower. Still, the Dow Jones Industrial AverageDJIA, +0.28% was on track for the best June since 1938. The blue-chip index and gold were defying their typically inverse relationship with stellar June returns for both.
Expectations for lower interest rates among global central banks and geopolitical concerns centered on trade spats and tensions with Iran had been making gold a preferred investment this spring, especially as competing low-risk U.S. Treasury bond yields dropped. The yield on the 10-year note TMUBMUSD10Y, -0.36% fell below 2% in recent sessions.
On Friday, U.S. data revealed that consumer spending rose at a healthy clip, up 0.4% in May, though that's a tick below the MarketWatch forecast. Separately, the University of Michigan said the final reading of its consumer sentiment index in June was 98.2, down from the 100 reading in May.
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Among other metals, the most-active September silver contract SIU19, +0.40% settled at $15.341 an ounce, up 4.7 cents, or 0.3%, for the session, with the contract notching a monthly rise of about 4.8%. September copper HGU19, +0.04% fell less than half a cent, or 0.1%, to $2.714 a pound, with the contract up 2.9% for the month of June.
October platinum PLV19, +2.68% added 2.9% at $841.10 an ounce, with the contract ending around 5% higher this month, while September palladium PAU19, -0.65% lost nearly 0.1% to $1,537.60 an ounce, but saw a sharp monthly rise of more than 15%.
Exchange-traded fund SPDR Gold Shares GLD, +0.27% was up 0.1% Friday, set for a monthly climb of 7.8%.