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Gold prices steadied on Friday as the dollar retreated and hopes for more US stimulus measures resurfaced, although the precious metal was on track to post its steepest weekly contraction since August.
Spot gold was flat at $1,868.29 per ounce by 0627 GMT. But prices are down over 4% for the week pressured by a broadly stronger greenback. US gold futures were down 0.3% to $1,871.
The dollar index was off its two-month peak but was on track for its best week since early-April, up 1.5%, making gold more expensive for holders of other currencies.
"With the data front quiet, it appears that investors want to stay nimble and hedged by leaving their money in dollar, rather than moving to precious metals or US bonds," said Jeffrey Halley, a senior market analyst at OANDA.
Investors also grew hopeful after a lawmaker on Thursday said Democrats in the House of Representatives were working on a $2.2 trillion coronavirus stimulus package that could be voted on as soon as next week.
US Federal Reserve policymakers, including chair Jerome Powell, made multiple public appearances this week calling on the US government to provide more fiscal support.
Gold prices have climbed more than 20% this year as central banks worldwide rolled out massive stimulus and slashed interest rates to near-zero to counter the economic damage from the COVID-19 pandemic.
Given that the COVID-19 situation has not improved and interest rates are lower, gold is still bullish in the longer term, said Brian Lan, managing director at dealer GoldSilver Central in Singapore.
"Support level for gold lies around $1,845 and resistance at $1,900."
Silver fell 1% to $22.98 per ounce and platinum rose 0.8% to $855.41.
Both metals are on track for their worst week since mid-March. Palladium edged 0.4% higher to $2,234.42 per ounce.
Pakistan’s rupee dropped to an all-time low of 146.5 to the dollar on Thursday, days after Islamabad announced it had reached an agreement with the International Monetary Fund on a fresh bailout for its troubled economy.
The yen and other safe-haven currencies were in demand on Monday. The yen, regarded as a haven in times of market turmoil by virtue of Japan’s status as the world’s biggest creditor,
In the Indian futures market, the price of gold rose to a new high, while in the international market, it is at an almost seven-year high. Gold in India’s largest futures market,
The US economy grew at a record pace in the third quarter as the government injected more than $3 trillion worth of pandemic relief which fueled consumer spending, but the deep scars from the COVID-19 recession could take a year or more to heal.
Aircraft manufacturers are hit by the devastating impact of the coronavirus pandemic on the aviation industry. The number of global commercial aircraft orders was zero during the month of September.
Peugeot manufacturer PSA Group returned to revenue growth in its core autos division in the third quarter, recovering from a slump during coronavirus lockdowns, though the prospect of new restrictions hit French shares.
The Bank of Japan (BOJ) trimmed its economic growth and inflation forecasts for the current fiscal year (2020-21) on Thursday but offered a more upbeat view on the recovery outlook, signalling that it has delivered enough stimulus for the time being.