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Gold Poised for Second Straight Weekly Gain as US Dollar Slides

July 21, 2017 at 16:58 by Andrew Moran

Gold futures are on track for their second straight week of gains as the US dollar continues to slide. With the greenback trading at its lowest levels in more than a year and Europe maintaining low interest rates, bullion investors propped up the yellow metal.

August gold futures climbed $7.20, or 0.58%, to $1,252.70 per ounce at 16:39 GMT on Friday. Gold is poised to record a 2% weekly gain – last week, gold prices advanced 1.5%. The yellow metal is also on track for six consecutive session gains.

Silver, the sister commodity to gold, is also rallying to end the trading week. September silver futures grew $0.09, or 0.58%, to $16.44 an ounce. The white metal is on course for a 3.1% weekly jump.

The precious metals are benefiting from a weaker US dollar as the greenback slipped another 0.25% on Friday. The US dollar is trading at its lowest level since June 2016. A lower dollar is good for commodities like gold and silver because it makes it cheaper for foreign investors to purchase.

Over the past week, US economic data has been mixed, causing many investors to be concerned that the Federal Reserve may postpone another hike to interest rates to later this year. The Federal Open Market Committee (FOMC) will hold a policy meeting next week.

It is unclear if any of the political turmoil occurring in Washington will have any effect on the US central bank’s decision. On Friday, Press Secretary Sean Spicer announced that he is resigning from his post over his disapproval of the White House appointing Anthony Scaramucci as communications director.

Overseas on Thursday, the European Central Bank (ECB) left rates unchanged and kept economic stimulus measures untouched. ECB President Mario Draghi even noted that the central bank is willing to amplify its stimulative measures to spur growth. This cause bond prices to tumble, but the euro rose.

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