Gold futures failed to hold early gains and settled flat on Friday as the dollar climbed higher after data showed a bigger than expected improvement in U.S. consumer sentiment and a drop in inflation expectations.<\/p>\n
The dollar index, which fell after exhibiting strength in the Asian session, recovered and climbed to 102.43 around noon, before easing a bit to 102.30, still up nearly 0.2% from the previous close.<\/p>\n
Gold futures for August settled at $1,971.20 an ounce, up $0.50 from the previous close, recovering from a low of $1,956.70. Gold futures shed 0.3% in the week.<\/p>\n
Silver futures for July ended higher by $0.179 at $24.126 an ounce, while Copper futures for July ended down $0.0065 at $3.8935 per pound.<\/p>\n
Edward Moya, Senior Market Analyst at OANDA says “gold really didn’t do a whole lot this week despite all the central bank fireworks and as stocks had the best week since March. A hawkish Fed hold was countered by some stimulus from China, which also comes with expectations that more help for the Chinese economy<\/span> is coming.”<\/p>\n “A gold plunge did not occur as the hawkish FOMC statement and staff projections was followed by a hesitant Fed Chair that refused to commit to a July hike,” adds Moya. “Gold won’t be attracting safe-haven flows until this stock market breaks and that might not if the AI trade remains intact. Adobe earnings kept the AI trade going, but despite all the buzz, it could be ready for a pause. Gold might continue to consolidate here, but should rebound the moment risk appetite heads for summer vacation.”<\/p>\n A report from the University of Michigan showed a bigger than expected improvement in U.S. consumer sentiment in the month of June.<\/p>\n The report said the University of Michigan’s consumer sentiment index climbed to 63.9 in June from 59.2 in May. Economists had expected in the index to inch up to 60.0.<\/p>\n The report also showed a significant decrease in year-ahead inflation expectations, which tumbled to 3.3% in June from 4.2% in May, hitting the lowest level since March 2021.<\/p>\n Five-year inflation expectations edged down to 3% in June from 3.1% in May, again staying within the narrow 2.9-3.1% range for 22 of the last 23 months.<\/p>\n The decrease in inflation expectations may add to recent investor optimism that the Federal Reserve won’t follow through on its plan to continue raising interest rates. <\/p>\n