Gold prices edged up on Friday,
supported by a weaker dollar amid worries about a possible U.S. government
shutdown, but the precious metal was still on track for its first weekly drop
in six weeks.
Spot gold was up 0.3 percent at
$1,331.10 an ounce by 0324 GMT. Gold on Thursday touched its weakest level
since Jan. 12 at $1,323.70, having fallen from recent four-month highs.
Spot gold has fallen 0.5 percent
so far this week, its worst since the week-ending Dec. 8.
U.S. gold futures were up 0.3
percent at $1,331.40.
The U.S. dollar fell amid worries
over a possible U.S. government shutdown. The dollar index was down 0.1 percent
at 90.394 on Friday.
Legislation to avoid a U.S.
government shutdown at midnight on Friday advanced in Congress, as the House of
Representatives on Thursday night approved an extension of federal funds
through Feb. 16, although the bill faced uncertain prospects in the Senate.
"The overall run in gold has
been overdone ... People have to be careful with further allocations in gold
and other asset classes as well for now," said Mark To, head of research
at Hong Kong's Wing Fung Financial Group.
"The overall weakness in
U.S. dollar is over ... I can't be more cautious on gold price at the
moment."
The dollar has fallen since 2017
largely on expectations central banks besides the Federal Reserve are seeking
to end their policy of ultra low, even negative, rates that they adopted to
combat the 2008 global financial crisis and the recession that followed.
The U.S. Federal Reserve should
raise interest rates three to four times in both 2018 and 2019, Cleveland
Federal Reserve Bank President Loretta Mester said on Thursday, a pace that is
a bit faster than many of her fellow policymakers prefer.
"The fundamentals remain the
same with the large trading range remaining intact at $1,200 to $1,400, with no
major change in global political tensions or rate hike outlook," To said.
Spot gold is still targeting
$1,311 per ounce, as suggested by a small double-top and a Fibonacci
retracement analysis, according to Reuters technical analyst Wang Tao.
Meanwhile, holdings of SPDR Gold
Trust, the world's largest gold-backed exchange-traded fund, rose 1.42 percent
to 840.76 tonnes on Thursday from Wednesday.
Among other precious metals,
silver rose 0.5 percent to $17.01 per ounce.
Platinum rose 0.2 percent to $1,002, while
palladium fell 0.5 percent to $1,105.
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Source: Moneycontrol
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