Gold prices edged higher and were on track for a fourth straight weekly gain on Friday, as uncertainty about U.S. President Donald Trump’s trade plans took wind out of the dollar’s sail, boosting demand for the safe-haven asset.
FUNDAMENTALS
* Spot gold edged up 0.2% to $2,760.40 per ounce, as of 0044 GMT and gained over 2% so far this week. U.S. gold futures added 0.1% to $2,767.60.
* The dollar was lower on Thursday in a choppy session, after comments from Trump called for an immediate drop in interest rates while providing no clarity on tariffs, while investors awaited a round of policy announcements from global central banks.
* The Bank of Japan is widely expected to raise interest rates at the end of a two-day meeting on Friday. Rate decisions from the U.S. Federal Reserve and European Central Bank (ECB) are scheduled for Wednesday and Thursday of next week, respectively. * Traders see a 99.5% chance of the Fed keeping rates unchanged at its Jan. 28-29 meeting, according to the CME Group’s FedWatch Tool. Higher rates dampen the appeal of the non-yielding bullion.
* Gold’s appeal as an inflation hedge may be diminished if Trump’s policies, which are seen as inflationary, lead the Fed to maintain interest rates higher for longer.
* Uncertainty about Trump’s trade plans prevailed as he said tariffs on imports from Canada, Mexico, China and the European Union could be announced on Feb. 1.
* Lack of clarity about future policies has led market participants flocking to safe-haven assets such as gold to hedge against volatility.
* Spot silver was up 0.1% to $30.47 per ounce, palladium gained 0.2% to $993.46 and platinum rose 0.4% to 945.85.
* All of the three metals were poised for weekly gains.
DATA/EVENTS (GMT) 0030 Japan JibunBK Mfg PMI Flash SA, JibunBK Comp Op Flash SA, JibunBK SVC PMI Flash SA Jan 0815 France HCOB Mfg Flash PMI, HCOB Services Flash PMI, HCOB Composite Flash PMI Jan 0830 Germany HCOB Mfg Flash PMI, HCOB Services Flash PMI, HCOB Composite Flash PMI Jan 0900 EU HCOB Mfg Flash PMI, HCOB Services Flash PMI, HCOB Composite Flash PMI Jan 0930 UK Flash Composite PMI, Flash Manufacturing PMI, Flash Services PMI Jan 1445 US S&P Global Mfg PMI Flash, S&P Global Svcs PMI Flash, S&P Global Comp Flash PMI Jan 1500 US Existing Home Sales Dec 1500 US U Mich Sentiment Final Jan