Gold drops due to the firmness of dollar

Gulf Today Report 

Gold prices dropped on Friday as the dollar remained firm due to an increase in US Treasury yield and the US Federal Reserve’s forecast of economic growth.

Spot gold was down 0.3% to $1,731.86 per ounce by 03:40 GMT while US gold futures were down 0.1% to $1,731.

Stephen Innes, chief global market strategist at financial services firm Axi said,  "the dollar is reacting to higher yields like it normally does, but it's also reacting to a stronger US economic situation that seems to be picking up at a quicker pace." 

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Innes added that a strong economy without inflation would affect gold negatively.

"Gold's upside looks limited by rising yields and buoyant risky assets... Talks around tapering asset purchases will be the key headwind later this year," ANZ analysts said in a note.