Gold closed lower, but achieved second quarterly gain in a row

Gold prices fell at the end of trading on Friday, due to the strength of the US dollar, but it achieved its second quarterly gain in a row in the first quarter of this year, as the growing bets that the Federal Reserve will slow down the pace of raising interest rates led investors to precious metal.

Spot gold fell 0.6% to $1,968.25 an ounce by 1826 GMT, after prices rose 0.4% following data showing US consumer spending rose modestly in February. US gold futures fell by 0.6%, to $1986.2 an ounce.

The precious metal achieved a monthly gain of 8.1% in March, and it also achieved a quarterly gain of 8.8% in the first quarter.

“Gold jumped quickly but modestly after the positive PCE report for the market,” said Tae Wong, an independent metals trader in New York.

He added, “The bulls want a very strong close, ideally above $2,000, of the quarter as a springboard to challenge the record $2,070, but the yellow metal is looking a bit tired.”

The dollar index, while declining for the quarter, stabilized on Friday, weighing on demand for gold priced in US dollars.

Last week, gold topped $2,000 after the sudden collapse of two US regional lenders, prompting bets that the Fed may hold off on raising interest rates to stop contagion risks in the global banking system.

Gold consumption in China slowed this week as the steady rise in domestic prices began to hurt, forcing traders to offer discounts for the first time in months.