Precious-Gold inched down on Friday yet set for its biggest weekly gain in a month as speculations the Fed would not raise interest rates anytime soon enhanced haven demand on the metal.
Fed minutes released this week did not include discussion about holding interest rates near its record low for a considerable time.
In addition, many policymakers highlighted that expectations of raising interest rates might be overstated.
While markets became sure the Fed would continue their bond purchases withdrawal at the same pace of $10 billion a month, the timing of raising the borrowing cost is not clear yet.
Fed Chairman Janet Yellen said on March 19, she hinted to the possibility of raising interest rates in six months after the end of bond purchases withdrawal, but she referred last week the U.S. economy will need to hold stimulus for “some time.”
Hence, demand on the shiny metal remained as investors resorted to the metal as a store of value against the undergoing low interest rates.
On the other hand, worries reignited in Ukraine after the region of Donetsk have proclaimed their independence from Kiev and vowed to hold a referendum in the next month.
“Ukraine sent security forces into eastern regions after pro-Russian protesters seized government buildings,” Bloomberg said.
Meanwhile, gold is trading near its highest in 2-1/2 weeks around $1316.15 an ounce after hitting a high of $1321.46 and a low of $1315.19.
So far, gold has gained 0.95 percent this week after recording an advance of 0.67 percent last week.
The U.S. dollar ticked up versus a basket of major currencies to hover around 79.47, falling from a peak of 80.76 touched on April 4, according to the dollar index.
Crude oil for May’s delivery retreated to trade around $103.13 a barrel after touching a low of $103.00.