Gold prices steadied on Friday, but remained on course for their best week since March 2018, after rising expectations for a US rate cut and concerns that trade tussles could hit global growth boosted demand for safe-haven bullion. However, having failed earlier this week to breach its 2019 high of $1,346.73, analysts expect the metal to consolidate until there is fresh impetus.
Spot gold was steady at $1,335.27 per ounce at 0902 GMT, while US gold futures were down 0.2% to $1,339.60. "We have had quite a move higher earlier this week, but we are moving towards levels where the market will struggle to go much higher," ING analyst Warren Patterson said. Gold has rallied in a short span of time, having gained about 2.3% this week, and is on track for its best seven days since week ending March 23, 2018.
"Overall sentiment is still fairly supportive for the gold market," Patterson added, attributing the recent price rally to a two-pronged US trade spat with Mexico and China, and hopes of an interest rate cut by the US Federal Reserve. Gold's appeal as a safe-haven investment is bolstered in times of geopolitical uncertainty.
"Gold is likely to stay muted through the rest of the day before the release of the non-farm payrolls. Investors want to see the impact on the US jobs market before reassessing the current pessimism," Howie Lee, an economist at OCBC Bank, said.