Gold heads for weekly loss, as Fed sticks to monetary tightening

Gold prices rose slightly today, Friday, with the decline of the dollar, but the yellow metal, is now on its way to record a weekly loss, as the Federal Reserve (the US central bank) expects to continue raising interest rates for a longer time.

According to Reuters, gold rose in spot transactions by 0.2 percent, to $ 1,780.78 an ounce, by 0621 GMT. And US gold futures increased 0.1 percent, recording $ 1,789.

The dollar index fell 0.2 percent, making gold less expensive for buyers from abroad.

Gold prices have fallen by nearly 1 percent during the week so far, retreating sharply from the highest level in five and a half months since the US Central Bank’s decision on Wednesday to raise interest rates by 50 basis points as expected and its Chairman Jerome Powell saying that more hikes are needed. It will take place next year, despite the economy’s slide towards recession

Gold is known as a hedge against inflation, but high interest rates tend to weaken its attractiveness because it increases the opportunity cost of holding the metal that does not yield a return.

Meanwhile, India raised the primary import price of gold and silver late Thursday evening. India is the world’s largest importer of silver and the second largest importer of gold

As for other precious metals, silver rose 0.2 percent to $ 23 an ounce, but it has so far recorded a decline of two percent for the week.

Platinum rose 0.6 percent to $1,000.54, and palladium rose 1.5 percent to $1,817.88, but it is on track to record its largest weekly decline in two months.