By: Reuters
The dollar index [.DXY 78.04 
-0.42 (-0.54%) 
]lost 0.4 percent on Friday, but was holding close to a seven-month high hit in the previous session, after investors fled commodities to the perceived safety of Treasuries.
"The dollar has strengthened in all of this and everyone is de-risking and putting money into the dollar because of the deteriorating economic outlook," said Soozhana Choi, head of commodity research in Asia at Deutsche Bank in Singapore.
"We saw massive de-risking across the board, and gold as well as other commodities weren't unscathed."
Spot gold [XAU= 1738.60
3.27 (+0.19%) ] edged up 0.4 percent to $1,742.30 an ounce by 0349 GMT, but was headed for a 3.8-percent decline for the week, its biggest weekly drop since May 8.
U.S. gold futures [GCCV1 1737.60 -4.10 (-0.24%) ] inched up 0.2 percent to $1,745.80, after posting their steepest daily loss in a month with a decline of 3.7 percent on Thursday.
Spot gold is expected to consolidate between $1,680 and $1,920 per ounce over the next three months before resuming its long-term uptrend, Reuters technical analyst Wang Tao said.
Gold edged up 0.4 percent on Friday after the previous day's drop, but remains on track for a third straight week of decline as investors worried about grim global growth outlook piled into the dollar, which weighs on bullion prices.
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Anthony Bradshaw | Getty Images |
-0.42 (-0.54%) ]lost 0.4 percent on Friday, but was holding close to a seven-month high hit in the previous session, after investors fled commodities to the perceived safety of Treasuries."The dollar has strengthened in all of this and everyone is de-risking and putting money into the dollar because of the deteriorating economic outlook," said Soozhana Choi, head of commodity research in Asia at Deutsche Bank in Singapore.
"We saw massive de-risking across the board, and gold as well as other commodities weren't unscathed."
Spot gold [XAU= 1738.60
3.27 (+0.19%) ] edged up 0.4 percent to $1,742.30 an ounce by 0349 GMT, but was headed for a 3.8-percent decline for the week, its biggest weekly drop since May 8.U.S. gold futures [GCCV1 1737.60
-4.10 (-0.24%) ] inched up 0.2 percent to $1,745.80, after posting their steepest daily loss in a month with a decline of 3.7 percent on Thursday. Spot gold is expected to consolidate between $1,680 and $1,920 per ounce over the next three months before resuming its long-term uptrend, Reuters technical analyst Wang Tao said.
The world's major economies pledged to prevent Europe's debt crisis from undermining banks and financial markets, and said the euro zone's rescue fund would be bolstered.
The news came a day after U.S. Federal Reserve Chairman Ben Bernanke warned of significant downside risks for economic growth, which triggered a sell-off in equities and commodities.
Americans filed fewer new claims for jobless benefits last week but the decline was not enough to dispel worries the economy was dangerously close to falling into a new recession.
Gold seems to have lost its safe-haven appeal, as it followed other commodities and sank more than 2 percent on Thursday, marking its biggest one-day drop in two weeks.
Spot silver [XAG= 35.02 -0.74 (-2.07%) ] rebounded 1.2 percent to $36.20 an ounce from a drop of nearly 10 percent in the previous session, its biggest one-day loss since early May when prices tumbled after hitting a record near $50.
Spot palladium [XPD= 656.75 16.17 (+2.52%) ] fell to $637.47, its lowest since mid-November 2010, before recovering to $642.75.
The news came a day after U.S. Federal Reserve Chairman Ben Bernanke warned of significant downside risks for economic growth, which triggered a sell-off in equities and commodities.
Americans filed fewer new claims for jobless benefits last week but the decline was not enough to dispel worries the economy was dangerously close to falling into a new recession.
Gold seems to have lost its safe-haven appeal, as it followed other commodities and sank more than 2 percent on Thursday, marking its biggest one-day drop in two weeks.
Spot silver [XAG= 35.02
-0.74 (-2.07%) ] rebounded 1.2 percent to $36.20 an ounce from a drop of nearly 10 percent in the previous session, its biggest one-day loss since early May when prices tumbled after hitting a record near $50. Spot palladium [XPD= 656.75
16.17 (+2.52%) ] fell to $637.47, its lowest since mid-November 2010, before recovering to $642.75. Copyright 2011 Thomson Reuters. Click for restrictions.
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