In the international market, gold prices slumped more than 1 per cent on Friday and the metal was heading for a second straight weekly drop as the dollar continued its upturn, overshadowing bullion's appeal as an inflation hedge as the US rolls out more stimulus.
The dollar index was on track for its biggest weekly gain since October 2020, making bullion more expensive for holders of other currencies.
"Bouts of dollar strength and the uptick in US yields have triggered short-term corrections," said Standard Chartered Analyst Suki Cooper.
"The gold market
is caught between longer-term buying on the back of rising inflation expectations given stimulus measures, but selling as the dollar has bounced and concern over QE tapering materialised."
Benchmark 10-year Treasury yields held close to near 10-month highs touched earlier in the week. "The Biden administration should support a much more expansive spending agenda than before," said Tai Wong, head of base and precious metals
derivatives trading at BMO.
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