Firmer Greenback Weighs on Gold; Oil Prices in Spotlight

On Friday, gold prices were seen declining, dragged lower by the firmer US dollar. Meanwhile the spotlight continues to focus on oil prices after OPEC decided to keep its oil production target.

Futures for the yellow metal declined 1.07% to $1,183.80 per ounce, while futures for silver slumped 3.01% to $16.050 per ounce.

The Dollar index, which measures the strength of the greenback against a basket of major currencies, rose 0.60% to 88.1350 points. 

Assets in the world’s biggest gold-backed exchange-traded fund, SPDR Gold Trust; came in at 718.82 tons yesterday, the lowest since September 2008.

Oil Prices

Oil prices continue to extend losses on Friday after the OPEC decided on Thursday to keep the production target unchanged. Prices for the commodity are expected to reach its biggest weekly decline since May 2011.

Futures for the North American benchmark West Texas Intermediate (WTI) for January delivery was seen trading around $69.05 a barrel on the New York Mercantile Exchange.

Brent futures declined 1.64% to $71.39 a barrel. The European benchmark crude is seen heading for its biggest annual decline since 2008 on the London-based ICE Futures Europe exchange.

On Thursday, The Organization of Petroleum Exporting Countries decided to keep its production target unchanged at 30 million barrels a day, resisting calls from Venezuela and some other members to take action to ease a global oil-supply gut. Oil prices have fallen by 35% this year as the US production climbed at the fastest rate in over 30 years.

“In the interest of restoring market equilibrium, the Conference decided to maintain the production level of 30 million barrel per day as was agreed in December 2011. As always, in taking this decision, member countries confirmed their readiness to respond to developments which could have an adverse impact on the maintenance of an orderly and balanced oil market,” OPEC said in a statement following the meeting.

 

 

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