Gold prices slipped lower on Friday, pulling away from a seven-week high as the U.S. dollar regained some strength, although ongoing U.S. political uncertainties continued to support demand for the safe-haven precious metal.
On the Comex division of the New York Mercantile Exchange, gold futures for February delivery were down 0.31% at $1,196.15, just off Thursday’s seven-week high of $1,204.30.
The February contract ended Thursday’s session 0.22% lower at $1,130.70 an ounce.
Futures were likely to find support at $1,176.50, Wednesday’s low and resistance at $1,204.30, Thursday’s high.
The dollar found some support after Federal Reserve Chair Janet Yellen said the U.S. economy is doing well and faces no serious obstacles in the short term, with the labor market looking strong.
Ms. Yellen was speaking at a town hall meeting with educators, in Washington.
A stronger U.S. dollar usually weighs on gold, as it dampens the metal’s appeal as an alternative asset and makes dollar-priced commodities more expensive for holders of other currencies.
But the greenback was still under heavy pressure since U.S. President-elect Donald Trump failed to offer details on his promises to boost fiscal spending and cut taxes at a highly-anticipated news conference on Wednesday.
The dollar was also hit after St. Louis Federal Reserve bank president James Bullard said on Thursday that the election of Donald Trump has not yet switched the U.S. economy to a new “regime” that requires a quick rise in interest rates, which can remain “fairly low” at least through 2017.
Bullard also said that “any effects from the new administration’s policies are only likely to be observed in 2018 and 2019.”
Elsewhere in metals trading, silver futures for March delivery declined 0.46% to $16.748 a troy ounce, while copper futures for March delivery fell 0.28% to $2.665 a pound.