Gold prices climbed on Friday as a weaker dollar made bullion cheaper for holders of other currencies, while the metal was poised for a third consecutive weekly gain on hopes that the U.S. Federal Reserve will pause rate hikes after July.
FUNDAMENTALS * Spot gold rose 0.1% to $1,971.79 per ounce by 0119 GMT. Bullion gained nearly 1% so far this week.
* U.S. gold futures gained 0.2% to $1,973.80.
* The metal slipped on Thursday from a two-month high as the dollar and bond yields climbed on stronger-than-expected U.S. labour market data.
* The number of Americans filing new claims for unemployment benefits unexpectedly fell last week, touching the lowest level in two months amid labour market tightness and defying efforts by the U.S. Fed to slow demand.
* The dollar index was 0.1% lower.
* The Fed is expected to raise rates by 25 basis points (bps) in a July 25-26 meeting next week, keeping them in the 5.25%-5.5% range until cuts are seen 2024 onwards, per CME’s Fedwatch tool.
* Most economists polled by Reuters expect a hike at the July meeting to be the last increase of the current tightening cycle from the Fed.
* In Asia, Japan’s core consumer inflation re-accelerated in June and stayed above the central bank’s 2% target for the 15th straight month, heightening the chance the Bank of Japan (BOJ) will revise up this year’s inflation at the July 27-28 policy meeting.
* Russia’s gold reserves stood at 74.9 million troy ounces at the start of July, the central bank said on Thursday.
* Spot silver rose 0.4% to $24.84 per ounce, platinum was also up 0.4% at $956.86 and palladium gained 0.2% to $1,280.43.