May 20, 2022: Gold prices firmed on Friday, poised for their first weekly gain since mid-April, as the dollar's pullback from two-decade highs and mounting concerns over U.S. economic growth revived demand for safe-haven bullion.
Spot gold was up 0.2% at $1,845.71 per ounce, as of 0556 GMT, having risen as much as 1.9% to a one-week high on Thursday. U.S. gold futures edged 0.1% higher to $1,844.30.
Prices are consolidating after coming up, with resistance at $1,850 and support around $1,810, said Brian Lan, managing director at dealer GoldSilver Central.
Prices of greenback-priced bullion have climbed about 1.9% this week, in tandem with what is set to be the dollar's first weekly loss in seven.
“Recession fears are now giving way to U.S. growth fears, and the latter is helping gold,” said Stephen Innes, managing partner at SPI Asset Management, but said the U.S. Federal Reserve's aggressive rate hike path and quantitative tightening would still be major down-drafts for gold.
As bullion yields no interest it can become less attractive to investors when short-term U.S. interest rates are hiked. It is, however, seen as a safe store of value during times of economic crises.
The U.S. central bank will lift interest rates higher by the end of this year than anticipated just a month ago, keeping alive already-significant risks of a recession, a Reuters poll of economists found.
Meanwhile, China cut its benchmark reference rate for mortgages by an unexpectedly wide margin on Friday, its second reduction this year as Beijing seeks to revive the ailing housing sector to prop up the economy.
Spot silver gained 0.5% to $22.00 per ounce and has climbed about 4.4% this week.
Platinum firmed 0.1% to $963.49, and palladium climbed 1.4% to $2,034.63. Both were set for weekly gains of about 2.5% and 4.5%, respectively.
Reuters
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