Investing.com - Gold prices ended the week near the lowest level since February 2010 on Friday, as market players prepared for a hike in interest rates by the Federal Reserve next month.
Gold for December delivery on the Comex division of the New York Mercantile Exchange dipped $1.60, or 0.15%, to close the week at $1,076.30 a troy ounce on Friday.
Gold fell to $1,062.00 on Wednesday, a level not seen in almost six years, as investors cut holdings of the precious metal amid expectations the Fed will raise rates for the first time in nearly a decade at its mid-December meeting.
For the week, prices of the precious metal declined $15.60, or 0.41%, the fifth straight weekly loss and the longest stretch of weekly declines since late July.
Minutes of the Fed's October meeting published Wednesday showed that most members of the Federal Open Market Committee believe a rate hike next month would be appropriate but would then proceed with caution on further tightening, assessing economic conditions closely.
Recent comments by Fed officials, including Janet Yellen, have bolstered expectations the U.S. central bank will raise interest rates for the first time in nine years when it meets December 15-16.
Gold futures are nearly 10% below highs hit in mid-October as investors recalibrated their expectations of U.S. monetary policy in response to hawkish signals from the Fed.
Expectations of higher borrowing rates going forward is considered bearish for gold, as the precious metal struggles to compete with yield-bearing assets when rates are on the rise.
The U.S. dollar ended the week close to the highest level since April against a basket of six other major currencies amid growing expectations for tighter monetary policy in the U.S. in the coming months.
Dollar-priced commodities become more expensive to investors holding other currencies when the greenback gains.
Also on the Comex, silver futures for December delivery shed 12.6 cents, or 0.89%, on Friday to settle at $14.09 a troy ounce by close of trade. Prices slumped to $13.99 on Wednesday, a level not seen since August 26.
On the week, silver futures slumped 16.9 cents, or 0.76%, the fifth consecutive weekly decline.
Elsewhere in metals trading, copper for December delivery dropped 2.1 cents, or 1.04%, on Friday to settle the week at $2.055 a pound. It earlier fell to $2.030, a level not seen since May 2009.
For the week, copper prices tumbled 10.6 cents, or 5.35%, as the possibility of higher borrowing costs in the U.S., a broadly stronger U.S. dollar and slower global economic growth, especially in China, weighed.
Prices of the red metal are down nearly 30% since May as fears of a China-led global economic slowdown spooked traders and rattled sentiment.
The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption.
In the week ahead, market players will focus on a flurry of U.S. economic data due on Wednesday for further indications on the strength of the economy and the likelihood of a December rate hike.
U.S. markets will be closed Thursday for the Thanksgiving holiday and Friday will be a half day.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, November 23
The euro zone is to release survey data on manufacturing and service sector activity. Germany and France are also to release individual reports.
The U.S. is to release private sector data on existing home sales.
Tuesday, November 24
In the euro zone, the Ifo Institute is to report on German business climate.
The U.S. is to release revised data on third quarter growth, as well as a report on the trade balance and data on consumer confidence.
Wednesday, November 25
The U.S. is to release a string of reports, including data on durable goods orders, personal spending, new homes sales and consumer sentiment, and a report on initial jobless claims, which is being released one day earlier than usual, because of the Thanksgiving Day holiday.
Thursday, November 26
Markets in the U.S. are to remain closed for the Thanksgiving Day holiday.
Friday, November 27
The U.K. is to release revised data on third quarter economic growth.