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Gold prices were headed lower on Friday, even though data that could show U.S. consumer prices hitting the highest level in about 40 years is due during the session, but rising U.S. bond yields and a firmer dollar have limited the precious metals value as an inflation hedge.
February gold
GCG22,
GC00,
declined by $3.60, or 0.2%, to $1,773.10 an ounce. The metal slipped 0.5%, to settle at $1,776.70 an ounce on Thursday, and is down 0.6% in the week so far. Meanwhile, March silver
SIH22,
dropped 0.7% to $21.82 an ounce, following a 1.9% slide on Thursday.
November consumer price inflation is expected to rise 6.7% on an annual basis, according to a poll of economists by Dow Jones Newswires and The Wall Street Journal. That would mark the fastest annual rate since the 1980s.
The data will be closely watched by markets and if hotter-than-expected, will increase expectations of a faster Federal Reserve tapering of its bond purchases, with the central bank due to meet next week.
“The metals are lower as the greenback stays firm with yields ticking higher ahead of the consumers inflation data,” said Peter Cardillo, chief market economist at Spartan Capital, in a note to clients.
The U.S. dollar was up 0.1% at 96.372, as measured by the ICE U.S. Dollar Index
DXY,
a gauge of the buck against a half-dozen rivals. The yield on the 10-year Treasury note
TMUBMUSD10Y,
rose 3 basis points to 1.509%.
In other Comex dealings, March copper
HGH22,
was flat at $4.333 a pound. January platinum
PLF22,
rose 0.1% to $938.70 an ounce and March palladium
PAH22,
fell 2.3% to $1,771.50 an ounce.
