Gold faces first weekly loss in three on Fed’s hawkish stance

Gold price stays bearish around $1,760, after a two-day downtrend, as sellers cheer the US Dollar’s rebound despite softer US economic data.

The precious metal traders digest recent hawkish comments by US Fed officials while market sentiment does not favour risk. The most significant factor for gold trading on Thursday was a slew of comments by Fed officials who expressed resistance to data and favoured the 50 bps rate hike in December to support the US Dollar, a move that eventually triggered the recent gold selloffs.

The latest comments were those by Minneapolis Federal Reserve Bank President Neel Kashkari. “With inflation still high but a lot of monetary policy tightening already in the pipeline, it’s unclear how high the US central bank will need to raise its policy rate,” said Fed’s Kashkari.

Talking about Thursday’s data from the United States, Philadelphia Fed Manufacturing Index fell to -19.4 versus -6.2 market forecasts and -8.7 prior. Further, Housing Starts declined by 4.2% MoM in October following September’s 1.3% contraction whereas Building Permits fell by 2.4%, compared to a 1.4% increase recorded in the previous month. Additionally, the Jobless Claims eased to 222K for the week ended on November 11 versus 225K expected and upwardly revised 226K prior.