NEW YORK: Gold rebounded on Friday and was set for a weekly gain, helped by bargain hunting, a slightly weaker dollar and lingering concerns over US-Iran talks in Oman, while silver recovered from a 1-1/2-month low.
Spot gold rose 3.9percent to USD4,954.92 per ounce by 2:18 p.m. ET (1918 GMT), recouping losses during a volatile Asia session following Thursday’s 3.9percent decline.
The yellow metal was headed for a weekly gain of about 2percent. US gold futures for April delivery settled 1.8percent higher at USD4,979.80 per ounce.
CME Group had flagged a delay in publishing metals settlement, earlier in the day. The US dollar index fell 0.2 percent, making greenback-priced bullion cheaper for overseas buyers.
“The gold market is seeing perceived bargain hunting from bullish traders,” said Jim Wyckoff, senior analyst at Kitco Metals.
Iran’s top diplomat on Friday said that nuclear talks with the US mediated by Oman were off to a “good start” and set to continue. The remarks could help allay concerns that failure to reach a deal might nudge the Middle East closer to war.
Wyckoff said gold’s rebound lacks momentum and the metal is unlikely to break records without a major geopolitical trigger. Gold, a traditional safe haven, does well in times of geopolitical and economic uncertainty.
Meanwhile, spot silver rose 8.6percent to USD77.33 an ounce after dipping below USD65 earlier in the session, but was still headed for a weekly drop, down over 8.7percent, following steep losses last week as well. “What we’re seeing in silver is huge speculation on the long side,” said Wyckoff, adding that after years in a boom cycle, gold and silver now appear to be entering a typical commodity bust phase.
CME Group raised margin requirements for gold and silver futures for a third time in two weeks on Thursday to curb risks from heightened market volatility. Spot platinum added 5.4percent to USD2,093.50 per ounce, while palladium rose 6.2percent to USD1,717.05.