June 23 (Reuters) – Gold prices rebounded on Friday, helped by a retreat in U.S. Treasury yields and safe-haven buying, although a hawkish stance on rate-hikes from Federal Reserve officials meant bullion was heading for its second straight weekly drop.
Spot gold was up 0.8% to $1,927.90 per ounce by 10:25 a.m. EDT (1425 GMT), after dropping to a more than three-month low earlier in the session. Prices are down 1.5% for the week.
U.S. gold futures gained 0.8% to $1,938.20.
“We are seeing a de-risking moment on Wall Street, stocks are selling off hard and demand for Treasuries is elevated,” said Edward Moya, senior market analyst at OANDA.
Wall Street’s main indexes fell and were set for weekly declines as hawkish comments from Fed Chair Jerome Powell and other officials fueled worries of interest rates staying higher for longer.
Benchmark 10-year Treasury yields slipped to a 10-day low, reducing the opportunity cost of owning non-yielding gold.
“Are these central banks getting ahead of themselves where they could start to reverse course, especially if we see economic data continue to break down and jobless claims and other employment factors start to build up,” said Phillip Streible, chief market strategist at Blue Line Futures in Chicago.
However, San Francisco Fed chief Mary Daly told Reuters two more U.S. interest-rate hikes this year is a “very reasonable” projection, but it is better to move more slowly and carefully than before.
Interest rate hikes raise the opportunity cost of holding non-yielding gold.
Spot silver rose 0.9% to $22.44 per ounce, but was set for its biggest weekly drop since October 2022. Platinum was down 0.3% to $920.38, on course for its worst week since August 2022.
Palladium fell 0.5% to $1,277.46 after hitting its lowest since May 2019 on Thursday.
Palladium could extend this year’s near 30% price decline as the rapid rise of electric vehicles threatens to hammer demand for the autocatalyst metal.
Reporting by Deep Vakil in Bengaluru; editing by Barbara Lewis
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