WASHINGTON (dpa-AFX) - Gold prices edged lower on Friday to snap a five-day rally as the dollar continued to gain on expectations of a more hawkish Fed.
Spot gold dropped 0.7 percent to $1,849.77 per ounce, after having hit a five-month peak on Wednesday. U.S. gold futures were down 0.7 percent at $1,851.60.
But the metal is still on track for a second week of gains amid growing inflation worries after data showed U.S. consumer prices recorded their sharpest jump in over 30 years last month.
The dollar climbed for a third day and headed for its best week in almost five months against major peers amid bets for earlier Federal Reserve interest rate hikes.
Short-dated U.S. Treasury yields edged higher as traders price in two rate hikes next year - a first rate increase by July and a high likelihood of another by November.
The Federal Reserve said it will begin winding down its monthly asset purchases later this month at a pace of $15 billion per month.
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