Gold falls on upbeat U.S. economic data and posts a weekly loss

Gold futures fell Friday to settle at their lowest in more than two weeks, also down from the week-ago finish, on the back of a jump in U.S. consumer sentiment and a slightly firmer dollar.

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“The risk-off tone is not delivering a strong bid for gold [Friday], and that is mainly attributed to the overall strength we saw with U.S. data this week and optimistic outlooks we saw on the corporate front,” said Edward Moya, senior market analyst at Oanda.

June gold GCM9, -0.74% on Comex lost $10.50, or 0.8%, to settle at $1,275.70 an ounce. Prices marked the lowest most-active contract finish since May 2, according to FactSet data. Declines left prices for the most-active contract down 0.9% for the week.

The gold-backed SPDR Gold Shares exchange-traded fund GLD, -0.85% declined 0.9% in Friday dealings, trading 0.8% lower on the week.

Haven gold found little traction Friday even as stocks initially traded lower after China cast fresh doubt on the likelihood of a trade pact soon. The Dow Jones Industrial Average DJIA, +0.12% was up 0.2% as gold futures settled.

The Chinese government and state media sent a clear signal to markets Thursday and Friday that it is reluctant to resume trade talks with the U.S., when a spokesman for the Ministry of Commerce called the Trump administration’s moves to raise tariffs last week, and the threat of additional tariffs on the roughly $300 billion in annually imported Chinese so far untouched by new duties, “bullying behavior,” that has resulted in “severe negotiating setbacks.”

However, “the overall belief still remains that both sides will eventually move the needle closer to outlining a deal,” Moya said.

U.S. economic data were upbeat, with the University of Michigan’s consumer sentiment index in May climbing to a reading of 102.4, a 15-year high, from April’s reading of 97.2.

The leading dollar index DXY, +0.14% was up 0.1%, headed for a weekly rise of 0.6%.

“Apart from the U.S. retail sales number, the economic data in the U.S. has been robust and investors are finding it difficult to believe how the Fed is going to keep its current monetary policy,” said Naeem Aslam, chief market analyst with TF Global Markets.

Among other metals, July silver SIN9, -0.99% declined 15.1 cents, or 1%, to $14.388 an ounce, for a weekly loss of 2.7%. July copper HGN9, -0.33% fell a penny, or 0.4%, to $2.739 a pound. It fell 1.3% for the week.

July platinum PLN9, -1.63% settled at $820.30 an ounce, trading down $13.30, or 1.6%, for the session, for a weekly loss of over 5%. June palladium PAM9, -1.26% shed $18.90, or 1.4%, to $1,305.80 an ounce, for a weekly loss of 3.3%.

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Ed Moya

With more than 20 years’ trading experience, Ed Moya is a market analyst with OANDA, producing up-to-the-minute fundamental analysis of geo-political events and monetary policies in the US, Europe, the Middle East and North Africa. Over the course of his career, he has worked with some of the world’s leading forex brokerages and research departments including Global Forex Trading, FX Solutions and Trading Advantage. Most recently he worked with TradeTheNews.com, where he provided market analysis on economic data and corporate news. Based in New York, Ed is a regular guest on several major financial television networks including BNN, CNBC, Fox Business, and Bloomberg. He is often quoted in leading print and online publications such as the Wall Street Journal and the Washington Post. He holds a BA in Economics from Rutgers University. Follow Ed on Twitter @edjmoya ‏

Ed Moya

Ed Moya

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