Gold Sets for Worst Weekly Drop in Months

Gold was flat on Friday, getting ready for its sharpest weekly decline since November, as markets digested the U.S. Federal Reserve’s policy tightening policy plan, one which led to a surge in dollar and Treasury yields.

Spot gold was unchanged at $1,797.71 per ounce early Friday morning U.S. gold futures was up 0.2% at $1,798.80.

The shiny yellow metal fell about 2% on the week, its worst plunge since Nov. 26.

The U.S. two-year yield, which reflects interest rate expectations, surged to 1.208% on Thursday, a nearly two-year peak.

Higher yields and interest rate hikes raise the opportunity cost of holding non-interest paying gold.

A recently published Reuters poll showed gold prices will drift lower in 2022 and 2023, as central banks raise interest rates.

Meantime, spot silver was up 0.2% to $22.79 U.S. an ounce. Platinum rose 0.6% to $1,028.36 U.S. and palladium fell 0.8% to $2,356.20 U.S.