PRECIOUS-Gold set for best weekly gain since Nov as U.S. dollar, yields ease

BY Reuters | TREASURY | 01/13/22 08:22 PM EST

Jan 14 (Reuters) - Gold prices on Friday were poised for their best weekly gain since last November, as investors await economic data that could provide clarity about U.S. Federal Reserve's tapering policy, while a weaker dollar and Treasury yields supported bullion.

FUNDAMENTALS

* Spot gold was flat at $1,820.08 per ounce, as of 0048 GMT. U.S. gold futures edged down 0.1% at $1,819.50.

* The safe-haven metal climbed 1.4% so far this week.

* The dollar weakened against a basket of currencies on Thursday to a two-month low, a day after data showed an expected surge in U.S. consumer prices in December.

* U.S. 10-year Treasury yields eased off two-year highs hit earlier in the week.

* Fed Governor Lael Brainard on Thursday became the latest and most senior U.S. central banker to signal that the Fed is getting ready to start raising interest rates in March.

* Gold is considered an inflationary hedge, but the metal is highly sensitive to rising U.S. interest rates, which increase the opportunity cost of holding non-yielding bullion.

* Investors await major U.S. economic data such as retail sales, industrial production and Michigan sentiment expected later in the day.

* U.S. producer price inflation slowed in December, while the number of Americans filing new claims for unemployment benefits increased to an eight-week high in the first week of January.

* Spot silver shed 0.2% to $23.03 an ounce, platinum was up 0.1% to $970.77, and palladium 0.4% to $1,881.12.

DATA/EVENTS (GMT) 0300 China Exports, Imports YY Dec 0300 China Trade Balance Dec 0700 UK GDP Est 3M/3M Nov 0700 UK GDP Estimate MM, YY Nov 0700 UK Manufacturing Output Nov 0745 France CPI (EU Norm) Final MM, YY Dec 1100 EU Reserve Assets Total Dec 1330 US Retail Sales MM Dec 1415 US Industrial Production MM Dec 1500 US U Mich Sentiment Prelim Jan (Reporting by Asha Sistla in Bengaluru; Editing by Sherry Jacob-Phillips)

In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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