Gold Silver Reports (GSR) – Spot gold fell 0.4 per cent to $US1,254.81 per ounce after hitting its highest since June 26 of $US1,266.40 on Thursday. Gold prices have fallen on profit-taking, a day after bullion touched a near six-month high and the dollar rebounded, but the metal stayed on track for a weekly gain as the appetite for risk waned.
The yellow metal was, however, on course for a weekly gain of about 1.3 per cent.
US gold futures settled down 0.8 per cent, at $US1,258.10 per ounce.
“There was some profit-taking as the US dollar remains resilient,” said Tai Wong, head of base and precious metals derivatives trading at BMO.
“Friday’s data saw softer growth but price indicators like personal spending and per capita expenditure were stronger which could argue, at the margin, against a Fed rate hike pause.”
The US economy slowed slightly more than previously estimated in the third quarter, but US consumer spending increased solidly in November as households bought motor vehicles and spent more on utilities, data by the US Commerce Department showed.
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The dollar recovered, attracting safe-haven buying as persistent equity market turbulence and possibilities of a US government shutdown taxed investors’ affinity for risk-taking.
US President Donald Trump conceded there was a good chance the Senate would not approve his demand for $US5 billion to fund his border wall project, and reiterated the likelihood of a government shutdown beginning at midnight.
Fears of a shutdown also compounded worries in stock markets, which extended a week-long sell-off, prompting some safe-haven inflows into bullion.
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“It’s still a very keen risk-off mentality in the world marketplace heading into the weekend and into the Christmas holiday next week.
Holdings of the SPDR Gold Trust GLD, the world’s largest gold-backed exchange-traded fund, slipped 0.3 per cent on Thursday, after reaching a four-month high earlier in the week.
Silver fell about 1 per cent to $US14.61 per ounce, but had gained about 0.4 per cent so far for the week.
