| Dhaka, Tuesday, 16 April 2024

Gold heads for longest losing streak since August 1973

Update : 2015-03-14 11:46:33
Gold heads for longest losing streak since August 1973

Gold reversed early gains on Friday and headed for a 10th straight session of losses, its longest losing streak in more than 40 years, as the dollar extended its rally.

Spot gold rose initially but was down 0.1% at $1,152.26 an ounce by 1521 GMT, heading to equal its run of losses in August 1973, when prices also fell 10 days in a row.

US gold for April delivery was unchanged at $1,151.30 an ounce.The metal was also headed for its sixth weekly loss in the past seven, down 1.3% so far and having hit its lowest in more than three months at $1,147.10 on Wednesday.

On Friday, the dollar rebounded against a basket of leading currencies, a day after its biggest one-day fall in a month.

Gold has taken a beating since a stronger-than-expected US jobs report last week stoked speculation the Federal Reserve would raise interest rates soon. The next focus will be the Fed's policy-setting committee meets on March 17-18.

"Gold is holding just above this key area of $1,150, but there is more downside risk as the dollar could continue its ascent ahead of next week's Fed meeting, especially as it is so close to parity level with the euro," Saxo Bank head of strategy Ole Hansen said.

The dollar hit its highest in nearly 12 years on Friday and is widely expected to reach parity with the euro, due to the gap between US and European market interest rates.

A stronger dollar would continue to cloud the outlook for gold, making it more expensive for holders of other currencies, while higher interest rates usually dent demand for assets that do not pay interest such as bullion.

In a reflection of bearish sentiment, holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.28 per cent on Thursday to 750.95 tonnes, the lowest since January. It has been three weeks since the fund had any inflows.

Other precious metals have also taken a hit. Silver, which was on track for a second straight weekly fall, was down 0.6% at $15.49 an ounce on Friday, while palladium was heading for its worst week since mid-January. Prices were unchanged at $789.30 an ounce on Friday.

Platinum was up 0.3 per cent at $1,112.23 an ounce, having fallen to its lowest since 2009 at $1,108.50 on Thursday.

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