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Gold bullish but on track to post third consecutively weekly decline

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Gold was bullish during the Asian session today as the asset class recovers from a decline of over 1% during the previous session. The U.S dollar index, which usually moves inversely to the yellow metal is near a one-week low and this, in turn, gave Gold a boost. However, the precious metal seems to be on track for a 3rd consecutive weekly decline as the U.S. Federal Reserve plans to begin asset tapering quicker than previously intended.

Gold futures is currently up 0.33%, currently trading at $1,755.55 as of the time of this writing, after trading as low as $1737.46 on Thursday, a level not traded since the 11th of August 2021, when gold flash crashed to below the $1,700 trading zone. Despite today’s bullish momentum, the yellow metal is currently down by 0.4% for the week.

The dollar, which normally moves inversely to gold, is up by 0.14% today to currently stand at 93.16 basis points. It, however, remained near the one-week low that it hit on Thursday.

The Bank of England and Norges Bank handed down their respective policy decisions yesterday. The Bank of England kept its interest rate unchanged at 0.10%, while the Norges Bank raised its interest rate to 0.25% from the previous month’s 0%.

The U.S Federal Reserve (FED) stated that it would likely begin asset tapering within 2021 and hike interest rates in 2022 when it handed down its latest policy decision on Wednesday.

On the data front, Japanese data released earlier in the day revealed that the national core consumer price index (CPI) grew 0% year-on-year in August. The national CPI contracted 0.4% year-on-year and 0.2% month-on-month respectively. The manufacturing purchasing managers index (PMI) for September was 51.2.

In other precious metals, silver is up 0.17%, currently trading at $22.72 and is up over 1% for the week so far. Platinum is down 0.40%, currently trading at $984.25 but is headed for a 4.3% weekly gain, its biggest in six weeks after posting massive gains 2 days ago. Palladium is up 1.55%, currently trading at $1,998.50 but is set to post its third consecutive week of decline.

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