Gold price futures log worst weekly loss of 2016

London (Mar 25)  Gold futures marked their third straight weekly loss, and the worst of 2016, on Thursday as shifting expectations for a Federal Reserve interest-rate increase supported the dollar at the expense of metals.

Gold futures for April delivery GCJ6, -0.60%  fell $2.40, or 0.2%, to settle at $1,221.60 an ounce, the lowest finish since late February. June gold GCM6, -0.56% which is also among the most-active contracts, ended at $1,223.50, down $2.10, or 0.2%.

The market will be closed Friday for Good Friday observance ahead of Easter. Gold prices were down 2.6% for the holiday-shortened week, after posting losses in each of the past two weeks, according to FactSet.

Recent comments pointing to a rate rise this spring has helped support the dollar, with the ICE U.S. dollar index DXY, +0.09%  set for a weekly gain of 1.1%. Higher interest rates lift the appeal of holding dollars and a firmer greenback tends to add pressure on dollar-denominated commodities.

May silver SIK6, -0.47%  declined by 7.3 cents, or 0.5%, to $15.199 an ounce, after losing 3.9% a day earlier. Prices posted a loss of 3.9% for the week.

Gold’s brief rise and then subsequent fall in the wake of the terrorist attacks in Belgium was a “typical value reaction to news that is both dynamic and evolving,” said Dean Heskin, president and chief executive officer of Swiss America. “As global markets recovered from the grim Brussels news, traders shifted their focus to comments out of the Fed indicating a potential rate rise at next month’s meeting.”

The Fed’s Dennis Lockhart and John Williams hinted at a potential rate hike as soon as April in speeches this week; even known doves like Charles Evans were relatively upbeat about the economy’s growth. A couple of reports issued Thursday might argue for a go-slow Fed. Data showed that U.S. weekly jobless claims were little changed at 265,000, while durable goods orders in February marked their third drop in four months.

Looking ahead, the spotlight for gold will focus on “upcoming economic data and market participants will benchmark that against the Fed tone,” said Naeem Aslam, chief market analyst at AvaTrade.

Among other metals, May copper HGK6, +0.11%  fell less than a cent, or 0.3%, to $2.229 a pound, for a weekly loss of 2.3%. April platinum PLJ6, -1.23%  shed $8.40, or 0.9%, to $952.40 an ounce, losing around 1.9% on the week, while June palladium PAM6, -1.44%  fell $10.45, or 1.8%, to $572.65 an ounce, for a weekly loss of roughly 3%.

Meanwhile, iron-ore prices fell Thursday. The Platts IODEX spot price stood at $55.50 per dry metric ton, down about $1.25 from Wednesday, according to Joseph Innace, Platts content director, Metals Americas.

“Some Chinese steel mill buyers of iron ore are saying that there will be an iron-ore supply surge next week because Australian ports have finished their maintenance work and about 13 million metric tons should reach Chinese ports next week,” said Innace.

Iron-ore prices have been volatile so far in March, caught up in conflicting economic data from China, robust port stockpiles, and U.S. dollar swings. Prices logged their largest ever one-day gain on March 7, after China announced plans to bolster its economic growth.

Among the metals miners Thursday, American depositary receipts in BHP Billiton BHP, +0.47%  were down 0.5%; Rio Tinto RIO, +0.14%  fell 0.3%. The SPDR Gold Trust GLD, -0.24% meanwhile, inched higher by 0.1%.

Source: MarketWatch