Gold Futures Settle Notably Lower As Dollar Continues To Rise

Gold prices fell on Friday as the dollar continued to climb after rebounding from a one-month low on Thursday.

The dollar gained in strength after the Bank of Japan maintained its ultra-low interest rates and dovish stance.

Investors looked ahead to the Federal Reserve’s monetary policy meeting next week for more clues about the pace of tightening in the upcoming months.

Although the Fed is expected to raise interest rates by 75 basis points in November, the possibility of a 50 basis point move at the subsequent meeting has risen.

The dollar index surged to 111.04 in the Asian session, and despite very nearly falling into the red around mid-morning, recovered to 110.90, gaining nearly 0.3%.

Gold futures for December ended lower by $20.80 or about 1.3% at $1,644.80 an ounce. Gold futures shed about 0.7% in the week.

Silver futures for December ended down $0.347 at $19.147 an ounce, while Copper futures for December settled at $3.4290 per pound, down 0.0905 from the previous close.

A report from the Commerce Department showed the annual rate of core consumer price growth accelerated to 5.1% in September from 4.9% in August. Economists had expected the annual rate of growth in core consumer prices, which exclude food and energy prices, to accelerate to 5.2%.

The report also showed personal income in the U.S. rose by slightly more than expected in the month of September, climbing by 0.4% in the month, matching the upwardly revised increase in August.

The report also showed personal spending increased by 0.6% in September following an upwardly revised 0.6% advance in August.

Revised data released by the University of Michigan on Friday showed U.S. consumer sentiment improved by slightly more than originally estimated in the month of October.

The consumer sentiment index for October was upwardly revised to 59.9 from the preliminary reading of 59.8. Economists had expected the index to be unrevised.

The revised reading for October is modestly higher than the final September reading of 58.6, with the index continuing to recover from all-time low of 50.0 in June.

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