Gold prices firm but head for second straight weekly loss

Gold prices edged higher on Friday but remained on track for a second consecutive weekly decline as geopolitical tensions and persistent inflation concerns weighed on the market. Spot bullion rose 0.8% to $5,118.39 per ounce by Friday morning, though it has lost about 1% of its value since the start of the week. In the United States, gold futures for April delivery stabilized at $5,124.70. The market's attention has shifted toward the conflict involving Iran and its impact on energy prices, which has complicated the outlook for interest rate cuts. Independent metals trader Tai Wong noted that while inflation data was largely in line with expectations, geopolitical factors are currently the primary market drivers. > As expected, there was little reaction in gold to the Feds favored inflation indicator, it was high but on consensus, the release had been delayed as it was January data, but mostly importantly the Iran conflict and oil prices are dominating every market, said Tai Wong, an independent metals trader. Economic indicators showed that consumer spending in the United States increased slightly more than expected in January. This strength, coupled with ongoing conflict in the Middle East, has reinforced the view among economists that the Federal Reserve may not resume rate cuts in the immediate future. Elevated interest rates typically reduce the appeal of gold, as they increase the cost of holding the non-yielding asset. Geopolitical developments further influenced the landscape as President Donald Trump indicated that the United States would increase pressure on Iran in the coming days. This statement followed the issuance of a limited 30-day waiver for purchasing sanctioned oil from Russia. While oil prices saw a slight dip, they remained positioned for weekly gains due to ongoing disruptions in the Gulf region. In terms of physical trade, the resumption of certain flights from Dubai has allowed gold flows from the major trading hub to partially recover. Performance across other precious metals was mixed; Silver climbed 0.7% to $84.32, while Platinum fell 1.4% to $2,102.12. Palladium also saw a decline, shedding 0.6% to reach $1,608.75, leaving both platinum and palladium on course for weekly losses.