Investing.com – Gold prices traded at one-year highs on Friday, supported by continued dollar weakness amid a drop in investor expectations of a December rate hike, after New York Fed president William Dudley appeared to adopt a less hawkish stance on monetary policy tightening.
Gold futures for December delivery on the Comex division of the New York Mercantile Exchange rose by $1.98, or 0.15%, to $1,352.36 a troy ounce.
The dollar drifted to a thirty-two-month low, boosting demand for the precious metal in the wake of William Dudley’s comments on monetary policy tightening.
"It's too soon to judge exactly the timing of when the next rate hike might occur, but the path is still clear that short term rates are going to move higher,\" said Dudley, one of the central bank's key decision-makers.
Dudley’s remarks were viewed as less hawkish, pointing to a potential dip in sentiment among Fed members on additional rate hikes this year, as it was only a month ago that the New York Fed president said that he expected rates to raise once more this year.
Gold is sensitive to moves lower in both bond yields and the U.S. dollar – A lower dollar makes gold less expensive for holders of foreign currency while a dip in U.S. rates, reduce the opportunity cost of holding non-yielding assets such as bullion.
Also supporting the yellow metal were fears that geopolitical uncertainty is poised to increase over the weekend as North Korea may launch another missile on Saturday to celebrate its 69th anniversary of the founding of the Democratic People’s Republic of Korea.
In other precious metal trade, silver futures fell 0.06% to 1.14% to $18.11 a troy ounce while platinum futures lost 0.53% to $1,011.45
Copper traded at $3.04, down 3.29%, while natural gas fell by 3.02% to $2.89.