Mumbai, 23 Mar (Commoditiescontrol): Gold prices fell on Friday as the dollar strengthened, but posted weekly gain after rallying to a record high in the previous session in the wake of the U.S. Federal Reserve's rate cut plans.
Spot gold was down 0.5% at $2,170.03 per ounce . Prices hit a record high on Thursday after the Federal Reserve indicated it still intended to cut rates three times this year. U.S. gold futures fell 0.6% to $2,171.50.
The dollar hit its highest in more than a month, making gold more expensive for other currency holders.
Traders are pricing in a 71% probability of a U.S. rate cut in June, according to the CME FedWatch Tool, up from 60% before the rate decision. Lower interest rates reduce the opportunity cost of holding non-yielding gold.
Investment flows into gold hit their highest in almost a year in the week to Wednesday, Bank of America Global Research said. However, "the set-up in gold has deteriorated, with CTAs now 'max long', macro traders positioned in line with rates market pricing, and Shanghai traders paring back their purchases following their epic buying activity over the last months," TD Securities said in a note.
In physical markets, jewellery stores in India wore a deserted look this week as record prices hammered appetite, but China still saw steady demand.
Silver fell 0.6% to $24.72 per ounce, platinum eased 1.3% to $896.18 and palladium lost 1.3% to $997.51. All three were on track for a weekly fall.
(By Commoditiescontrol Bureau: 09820130172)
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