Gold poised for best week since early May as dollar, yields ease

Gold was set on Friday for its best week in more than five months as a retreat in the U.S. dollar and Treasury yields lifted the metal’s appeal despite a looming Federal Reserve taper.

FUNDAMENTALS


* Spot gold held steady at $1,794.09 per ounce by 0115 GMT but was up 2.1% for the week so far. On Thursday, prices hit a one-month high of $1,800.12.

* U.S. gold futures inched down 0.1% to $1,795.50.

* Both the dollar index and benchmark U.S. 10-year Treasury yields pulled back from their multi-month highs.

* Despite a broadly shared view that the U.S. labour market has healed enough to allow the Fed to start reducing its monthly bond purchases as soon as next month, policymakers are sharply divided over inflation and what they should do about it.

* The International Monetary Fund’s steering committee on Thursday urged global policymakers to monitor pricing dynamics closely, but to “look through” inflationary pressures that are transitory and will fade as economies normalise.

* The number of Americans filing new claims for unemployment benefits dropped below 300,000 last week for the first time in 19 months.

* The Labor Department said its producer price index for final demand rose 0.5% in September, the smallest gain in nine months.

* Miner Barrick Gold Corp on Thursday reported a nearly 5% rise in third-quarter gold production from the previous three months, as output jumped at its Veladero mine in Argentina.

* Spot silver fell 0.4% to $23.45 per ounce but was headed for its biggest weekly gain in seven.

* Platinum eased 0.1% to $1,054.09, having hit a peak since Aug. 2 at $1,062.50 on Thursday.

* Palladium rose 0.2% to $2,132.21.