Gold prices ended higher on Friday but suffered a monthly decline—their sixth such loss in a row—as the benchmark U.S. dollar index continued to strengthen.
The yellow metal had markedly dropped a day earlier as the dollar index deepened its advance, seen after theFederal Reserve this week lifted federal-funds rates for the third time this year and signalled it was prepared to increase again in December. The ICE U.S. dollar index DXY, +0.15% was up 0.2% Friday and headed for 0.5% third-quarter gain.
“Gold has been trading in a rather good range after dropping to fresh one-month lows on the stronger [U.S.] dollar narrative,” said Stephen Innes, head of trading at Oanda Asia
“But frankly, the market is so oversold that we should expect consolidation to set in before the next leg lower,” he said. “We’re in the domain of the ‘gold bears’ who have August $1,160 lows in their crosshairs,” Innes concluded