Gold dips, approaches fourth weekly gain after Powell boost
Gold dipped on Friday morning in Asia even as it headed toward a fourth consecutive weekly gain. The safe-haven asset was boosted by Federal Reserve Chairman Jerome Powell’s pronouncement that any inflation will be transitory and that the central bank would continue to support the economy.
Gold futures slipped 0.5% to $1,828.10 by 12:20 AM ET (4:20 AM GMT) but went up 1.2% this week. The dollar, moving inversely to gold, went down on Friday.
Powell gave his statements on the second day of his testimony before the US Congress’ Financial Services Committee on Thursday, where he reaffirmed his pledge of “powerful support” for the US economic recovery from the effect of COVID-19.
However, investors largely expect that the Fed will begin asset tapering by the end of 2022. A number of investors also anticipate a hike in interest rate as early as 2022 but still recognize that the recent surge in COVID-19 cases due to the Delta variant remains the top economic risk.
Investors continue to mull over the second-quarter GDP figure from China, a leading consumer of the yellow metal. Expectations for policymakers to do more to hasten economic recovery continue to rise as higher costs of raw materials and resurgence of COVID-19 cases slow down growth.
Meanwhile, Barrick Gold Corp revealed on Thursday its second-quarter gold production went down 5.4% from the previous quarter.
In related news, silver remained unmoving and palladium crept up 0.1% while platinum slid 0.1%.