Gold rose slightly on Friday, picking up for the first time in five days, but still heading towards its biggest weekly drop in four months. The metal prices were dragged lower by the strengthened US dollar and the Federal Reserve’s suggestion to increase the interest rates in the first six months of 2015.
Gold futures edged 0.12% higher to $1,332.10 an ounce on Friday, hanging close to a three-week low, compared to the six-month high of $1,391.76 seen on Monday.
Holdings in the world’s largest bullion-backed exchange-traded fund, SPDR Gold Trust; came in at 812.78 tons on Thursday.
Gold – Federal Reserve Outlook
Minutes from the Federal Reserve’s (Fed) March meeting continues to weigh on the commodity market, as the Fed Chair Janet Yellen said that the benchmark interest rate is forecasted to climb within first six months of 2015.
According to the minutes from the March meeting, Fed policymakers forecasted the benchmark rate, would increase by at least 1% by the end of 2015 and by 2.25% by the end of 2016, as the US central bank announced a further reduction to its monthly bond purchases by another $10 billion to $55 billion.
St Louis President James Bullard, Dallas Fed President Richard Fisher, Minneapolis Fed President Narayana Kocherlakota and Fed Governor Jeremy Stein are expected to give speeches later in the day.
Ukraine
Meanwhile, the ongoing tensions between Ukraine and Russia over the Crimean region continues to weigh on the commodity market, as the US President Barack Obama imposed personal sanctions on officials and business leaders that have ties with the Russian President Vladimir Putin.
The lower house of the Russian Federal Assembly approved the treaty to annex Crimea, while the upper houses are expected to vote on Friday.
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