Gold Prices Fall for Fourth Straight Session as Strong U.S. Data Boosts Dollar
Gold prices extended losses on Friday, declining for a fourth consecutive session as stronger-than-expected U.S. economic data supported the dollar and reduced expectations for near-term Federal Reserve rate cuts.
Investors also closely monitored developments from talks between President Donald Trump and Chinese President Xi Jinping, while ongoing geopolitical tensions continued influencing commodity markets.
By early trading:
- Spot gold fell 2.1% to $4,553 per ounce
- U.S. gold futures declined 2.7% to $4,557 per ounce
Gold was down more than 3% for the week, signaling growing pressure on safe-haven assets.
Silver and Platinum Also Record Sharp Losses
Weakness extended across the broader precious metals market.
Other major declines included:
- Silver: -7.5% to $78.97 per ounce
- Platinum: -4% to $2,007 per ounce
The widespread selloff reflected shifting expectations surrounding inflation, interest rates, and the strength of the U.S. dollar.
Strong U.S. Economic Data Supports Dollar Rally
The U.S. Dollar Index (DXY) rose approximately 0.3%, reaching its highest level in two weeks and heading for gains exceeding 1% this week.
Several economic reports strengthened expectations that inflation remains persistent:
- Producer prices recorded the largest annual increase in four years
- Consumer inflation exceeded forecasts
- Retail sales data showed resilient consumer spending despite rising energy costs
These indicators reinforced concerns that the Federal Reserve may maintain tighter monetary policy for longer.
Markets Reduce Expectations for Fed Rate Cuts
Following recent economic data, traders significantly reduced expectations for Federal Reserve easing this year.
Some market participants have even begun pricing in the possibility of additional interest rate hikes, rather than cuts.
Higher interest rates generally weigh on gold because the metal does not generate yield, making interest-bearing assets comparatively more attractive.
At the same time, a stronger dollar increases the cost of gold purchases for international buyers, further reducing demand.
Trump-Xi Summit Ends Without Major Breakthroughs
Markets also watched the latest meeting between President Donald Trump and Chinese President Xi Jinping in Beijing.
Although both sides described discussions as constructive, the summit concluded without significant new trade agreements or major policy announcements.
Chinese officials stated the two countries reached an important consensus on maintaining stable economic relations and increasing international coordination.
Earlier comments from Trump suggested U.S.-China relations remained strong, while Xi reportedly offered assistance regarding Iran and the Strait of Hormuz situation.
Iran Tensions and Rising Oil Prices Complicate Gold Outlook
Geopolitical concerns remain elevated following comments from President Donald Trump regarding Iran.
Trump indicated continued military pressure could remain an option, increasing fears of further escalation in the region.
At the same time, disruptions affecting the Strait of Hormuz have contributed to rising oil prices.
Higher energy costs create additional inflation concerns globally, complicating the outlook for gold markets.
Normally, inflation fears support gold demand. However, when inflation also increases expectations for higher interest rates, the effect can reverse and pressure bullion prices lower.
Copper Prices Also Decline Amid Commodity Weakness
Industrial metals joined the broader commodity selloff.
Recent losses included:
- London Metal Exchange copper futures: -2.6% to $13,644 per ton
- U.S. copper futures: -3.1% to $6.37 per pound
The declines reflected cautious investor sentiment across commodity markets.
Gold Traders Remain Focused on Fed Policy and Geopolitical Risks
Future direction for gold prices will likely depend on several key factors:
- Federal Reserve interest rate expectations
- U.S. inflation data
- Strength of the U.S. dollar
- Geopolitical developments involving Iran and global trade
With markets increasingly pricing out rate cuts, gold remains vulnerable to additional short-term pressure.
