Investing.com - Gold prices gained on Friday in the U.S. as Donald Trump delivered an inaugural address as president that vowed to pursue an America First policy in economic management, raising same concerns that global trade patterns are in for more shock as Brexit looms and the North American Free Trade Agreement comes under the scanner.
"From this moment on, it's going to be America First," Trump said. "Every decision on trade, on taxes, on immigration, on foreign affairs, will be made to benefit American workers and American families. We must protect our borders from the ravages of other countries making our products, stealing our companies, and destroying our jobs. Protection will lead to great prosperity and strength."
On the Comex division of the New York Mercantile Exchange, gold futures for March delivery rose 0.67% to $1,209.50 a troy ounce, while copper futures gained 0.21% to $2.616 a pound with the industrial metal seen as a bellwether for global economic prospects.
The dollar weakened against a basket of currencies on Friday as Donald Trump became the 45th president of the United States and used his inaugural speech to hit populist themes on halting off-shoring of work that have raised concerns of a trade war with leading manufacturing exporters such as China.
The U.S. dollar index fell 0.33% to 100.07. In earlier trade, gold's safe-have status was sought as caution surrounded Trump’s future policies. The February contract ended Thursday’s session 0.87% lower at $1,201.50 an ounce.
However, gold faces resistance to higher prices on expected interest rate hikes this year with Fed Chair Janet Yellen noting on Thursday the central bank should continue to raise interest rates, but slowly.
Speaking at a conference in San Francisco, Yellen said that "allowing the economy to run markedly and persistently ‘hot’ would be risky and unwise," before adding: "I consider it prudent to adjust the stance of monetary policy gradually over time."
The greenback also initially strengthened on Thursday following the release of strong U.S. jobless claims and housing starts data, as well as an upbeat Philly Fed manufacturing activity report on Thursday. A stronger dollar makes gold, denominated in greenbacks, more expensive in other currencies, particularly the world's top two buyers, India and China.
On Friday data showed that China’s gross domestic product rose 6.8% in the fourth quarter of 2016, in line with expectations. Year-on-year, China’s economy grew at a rate of 6.8%, slightly above expectations for a growth rate of 6.7%.
The data eased concerns over a slowdown in the world’s second biggest economy, although worries surrounding the country’s growing debt persisted.