Gold prices fell on Friday and were on track for a third consecutive weekly decline, as a stronger dollar and hawkish signals from the U.S. Federal Reserve weighed on the non-yielding metal.
Spot gold was down 0.6% at $4,184.33 U.S. per ounce, soon after midnight EDT Friday. The contract was down 0.9% so far this week.
U.S. gold futures for August delivery fell 1% to $4,202.10.
Markets in mainland China and Hong Kong were closed for the Dragon Boat Festival holiday.
The dollar hovered around a one-year high, making greenback-priced bullion more expensive for other currency holders. Americans had Juneteenth off.
Nine of the U.S. central bank’s 19 policymakers now believe they will need to raise the policy rate this year, according to projections published on Wednesday after the Fed announced its decision to leave the policy rate unchanged in Kevin Warsh’s debut policy meeting as chairman.
Inflationary pressures stemming from the Iran war have prompted a growing number of central banks to either raise borrowing costs or signal moves to tame price growth.
Traders now see an 87% chance of a U.S. rate hike in December, jumping from 61% prior to the Fed decision, according to the CME FedWatch Tool.
Gold tends to lose appeal when rates are high, as it does not yield interest.
On the geopolitical front, oil tankers sailed through the Strait of Hormuz and the U.S. said it lifted its blockade on Iran on Thursday.
Spot silver fell 1.5% to $64.83 U.S. per ounce, platinum lost 1.3% to $1,674.47 U.S., and palladium was down 0.8% at $1,268.65 U.S.
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