Investing.com - Gold prices will remain susceptible to any further gains in the dollar this week after declines on Friday on the back of a stronger greenback which was boosted by expectations for a more aggressive pace of policy tightening by the Federal Reserve this year.
Metals traders will be awaiting an update on the health of the U.S. economy ahead of Friday’s data on first quarter growth, which could help determine the direction of the dollar.
Trade and geopolitical developments will also be in focus as possible drivers of safe haven demand for the precious metal amid lingering worries over the simmering trade tensions between the U.S. and China.
Gold futures for June delivery settled down $11.30 or 0.84% at $1,337.50 on the Comex division of the New York Mercantile Exchange. For the week, prices were down 0.71%, snapping two weeks of gains.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was up 0.49% at 90.08 late Friday, after rising to two-week highs of 90.25 earlier. The index was up 0.65% for the week.
A stronger dollar makes gold and other dollar-denominated commodities more expensive for holders of other currencies.
Cleveland Fed President Loretta Mester said Thursday that steady interest-rate rises are needed this year and next to keep the economy from overheating.
Her comments boosted expectations that the Fed will raise rates at a faster pace than markets currently expect this year, a potentially bearish development for gold, which struggles to compete with yield-bearing assets when rates rise.
Elsewhere in precious metals trading, silver futures settled down 0.72% at $17.11 a troy ounce, bringing the week’s gains to 2.95%.
Platinum futures settled at $929.40, down 1.14% for the day, for a weekly loss of 0.52%.
Among base metals, copper for May delivery was slightly higher at $3.137 in late trade for a weekly gain of 2.09%.
Ahead of the coming week, Investing.com has compiled a list of significant events likely to affect the markets.
Monday, April 23
The euro zone is to release data on manufacturing and service sector activity.
The U.S. is to report on existing home sales.
Bank of Canada Governor Stephen Poloz is to testify before the House of Commons finance committee in Ottawa.
Tuesday, April 24
Australia is to release data on inflation.
The Ifo Institute is to report on German business climate.
The U.S. is to release data on consumer confidence.
Wednesday, April 25
Financial markets in Australia will remain closed for a holiday.
BoC Governor Stephen Poloz is to testify before the Senate banking committee in Ottawa.
Thursday, April 26
The ECB is to announce its latest monetary policy decision. The announcement is to be followed by a press conference with President Mario Draghi.
The U.S. is to release reports on durable goods orders and initial jobless claims.
Friday, April 27
South Korean President Moon Jae-in and North Korean leader Kim Jong Un are expected to hold a summit meeting to discuss de-nuclearization and a peace treaty.
The Bank of Japan is to announce its benchmark interest rate and publish a rate statement which outlines economic conditions and the factors affecting the monetary policy decision. The announcement is to be followed by a press conference.
Swiss National Bank Chairman Thomas Jordan is to speak at an event in Bern.
The UK is to release preliminary data on first quarter economic growth as well as revised data on consumer sentiment.
The U.S. is to publish advance data on first quarter growth.
Bank of England Governor Mark Carney is to speak at an event in London.