Prices for gold rose on Friday and were on course for their best week in nearly five months, as the U.S. dollar extended its retreat in the wake of worrying U.S. economic data.
Spot gold rose 0.2% to $1,759.79 U.S. per ounce. It has gained about 2% so far this week, the most since early-March. U.S. gold futures rose 0.4% to $1,757.80.
Gold remains inversely correlated to the dollar and yields, rather than being a gold story in itself, analysts have said. Despite an upbeat week for gold, it was still poised for a fourth consecutive monthly drop, its worst run of monthly losses since November 2020.
The dollar has spent most of July hovering around 20-year highs, hammering demand for greenback-priced gold among other currency holders.
Also weighing on bullion prices were top central banks adopting an aggressive approach to interest rate hikes and monetary policy tightening in their attempt to combat inflation, along with a strong showing from U.S. Treasury yields earlier in July.
Higher rates lift bond yields, increasing the opportunity cost of holding non-yielding gold.
