3 months ago
Commodities

Gold Inches Down as Traders Turn to U.S. Dollar

Investing.com - Gold prices continued to fall on Friday, as demand for the U.S. dollar rose after upbeat retail

Investing.com - Gold prices continued to fall on Friday, as demand for the U.S. dollar rose after upbeat retail sales alleviated fears of a slowing economy.

Comex gold futures for February delivery slumped 0.6% to $1,239.50 a troy ounce as of 10:36 AM ET (15:36 GMT).

The price of bullion was pushed lower by a stronger greenback. The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, rose 0.55% to 97.59.

The precious metal usually falls as the dollar rises, as it is denominated in the U.S. currency and is sensitive to moves. Bullion becomes more expensive for holders of other currencies when the dollar rises and cheaper when it falls.

The dollar rose after retail sales in November came in higher than expected. Core retail sales, which exclude automobiles, gasoline, building materials and food services, rose 0.2% in November, after a 1% increase in the previous month.

Meanwhile, investors turned their focus to the Federal Reserve meeting next week.

The Fed is expected to increase rates by 25 basis points at its next meeting on Wednesday, its fourth rate hike this year. Chances of a hike are priced in at 79.2%, according to Investing.com’s Fed Rate Monitor Tool.

Dollar gains are likely to be short lived however, as the central bank is expected to slow down its pace of rate hikes in 2019.

Other metals were lower on the Comex, with silver futures falling 1.6% to $14.605 a troy ounce. Among other precious metals, platinum futures decreased 1.3% to $786.70, while palladium futures dipped 2.2% to $1,164.45 an ounce. Copper futures were down 0.7% to $2.746 a pound.