Economic news

Gold en Route to Weekly Gain, Digs in for U.S. Data

* Gold may break support at $1,769/oz - technicals

* Palladium, platinum head for best week since March

June 25 (Reuters) - Gold rose on Friday and was set to post its first weekly rise in four, propped up by a subdued dollar as investors awaited data that could shed more light on the U.S. inflation picture.

Mixed signals from Federal Reserve officials on the interest rate path saw gold prices slide 6% last week, then recover this week by 0.9%.

By 0706 GMT, spot gold was up 0.2% at $1,779.50 per ounce while U.S. gold futures were 0.2% higher at $1,780.20.

“Gold prices are congested in a tight range,” said Hareesh V., head of commodity research at Geojit Financial Services. “Inflation concern is the main reason why prices are not plummeting from this point.”

Gold is viewed as a hedge against higher inflation that could follow stimulus measures. On investors’ radar is U.S. producer price data due later in the day.

In the medium term, a recovering U.S. economy should strengthen the dollar, further easing gold’s safe-haven appeal, Hareesh added.

The dollar index was headed for a weekly decline after rising nearly 2% last week on the Fed’s hawkish signal.

Fed chief Jerome Powell, however, said earlier this week that inflation would not be the only determinant of interest-rate decisions, calming investors worried about policy tightening.

Spot gold may break a support level at $1,769 per ounce and fall into a range of $1,734-$1,744, according to Reuters technical analyst Wang Tao.

Palladium rose 0.6% to $2,655.72 per ounce, while platinum was 0.7% higher at $1,099.98. Both metals were on track for their best week since March.

Silver was up 0.8% at $26.14 per ounce.

(Reporting by Eileen Soreng and Brijesh Patel in Bengaluru; Editing by Aditya Soni and Pravin Char)

Source: Reuters

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