June 5 (Reuters) - Gold prices edged lower on Friday,
and were set for a weekly loss, as tensions in the Middle East
dampened hopes for a U.S.-Iran peace deal amid rising inflation
and rate-hike fears.
FUNDAMENTALS
* Spot gold was down 0.3% to $4,462.22 per ounce, as
of 0049 GMT. It has fallen about 1.6% for the week so far.
* U.S. gold futures for August delivery fell 0.4% to
$4,489.
* The Iran-backed Hezbollah militia rejected a new ceasefire
in Lebanon and Israel said it would not withdraw troops from the
country, undermining U.S. President Donald Trump's efforts to
halt fighting there to forge peace with Tehran.
* Kansas City Federal Reserve President Jeffrey Schmid said
on Thursday that the U.S. central bank's choice now is between
being patient and holding interest rates steady or hiking rates
to tamp down inflation that has been above target for years.
* Meanwhile, San Francisco Fed President Mary Daly said the
U.S. interest-rate path will depend on how the economy evolves,
adding that monetary policy is "in a good place" and the Fed is
prepared to respond "either way."
* While gold is seen as a hedge against inflation, higher
rates tend to weigh on the non-yielding metal.
* Investors are now awaiting the May U.S. nonfarm payrolls
data, due later in the day, to gauge the Fed's monetary policy
path.
* India's physically backed gold exchange-traded funds
(ETFs) recorded their first net monthly outflow in a year in
May, as investors booked profits following a sharp rise in
prices triggered by higher import duties, data showed on
Thursday.
* Physical investment is set to replace jewellery as the
largest component of gold demand for the first time this year
due to double-digit losses in jewellery amid high prices,
consultancy Metals Focus said in its annual report.
* Spot silver fell 0.6% to $73.45 per ounce, platinum
dropped 1.3% to $1,876.58, and palladium slid 1.5%
to $1,301.25. All metals were headed for a weekly loss.
DATA/EVENTS (GMT)
0900 EU GDP Revised QQ, YY Q1
1230 US Non-Farm Payrolls May
1230 US Unemployment Rate May
1230 US Average Earnings YY May
(Reporting by Pablo Sinha in Bengaluru; Editing by Subhranshu
Sahu)
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