Gold On Track For Worst Weekly Performance Since Late November

Early on Friday, gold prices are on the way back up after falling to an over two-month low, but remain on track to post the worst performance seen in ten weeks on the back of a recent strengthening in the US dollar. At the time of writing, GOLD is trading at a little above $1,796.

So far this week, gold has lost around 2.7% of its value – registering the steepest decline since late November. During the previous session, the yellow metal’s prices fell to a low of around $1,784 – the weakest level since December 1.

The safe haven metal of gold has come under pressure over recent economic data releases from the US that have revealed a better pace of economic recovery than in most other parts of the world. US factory orders posted a greater than expected rise for the month of December even as unemployment claims in the US declined further during the past week, raising hopes for an improvement in the labor market.

In addition, rising hopes for more stimulus measures that can aid US’s economic recovery are also exerting downward pressure on gold prices for now. On Thursday, Democrats in the US Senate were set to move forward with helping pass Biden’s $1.9 trillion stimulus package without Republican support.

The recent performance of the US economy has also helped the US dollar and Treasury yields rise higher, sending the precious metal on a bearish trend as a result. Gold shares a negative correlation with both the dollar and Treasury yields, while the overall improvement in risk sentiment in global markets has also driven prices lower.