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Gold Crashes on Profit-Taking; Investors Monitor Fed Policy, Economic Data

Gold Crashes on Profit-Taking; Investors Monitor Fed Policy, Economic Data
Gold futures suffered a sharp selloff to close out the trading week as investors took profit. The yellow metal is still on track for a weekly gain and has kept its year-to-date rally intact. Gold prices have shown signs of reigniting their aggressive ascent from April before running out of steam. Can gold touch $2,400 again?

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Gold futures experienced a significant drop at the end of the trading week as investors cashed in on profits. Despite this, the precious metal is still on track for a weekly gain and has maintained its year-to-date rally. Gold prices have shown signs of picking up momentum again, but have struggled to maintain it. The question remains whether gold can reach $2,400 once more.

August gold futures fell by $31.00, or 1.31%, to $2,338.00 per ounce on Friday. Meanwhile, silver also took a hit, with July silver futures dropping $1.171, or 3.8%, to $29.65 per ounce. However, silver is still set to enjoy a weekly boost of 2%, adding to its year-to-date surge of more than 23%.

The leading metal markets benefited from weak economic data this week. Retail sales rose less than expected in May, and initial jobless claims came in above the consensus estimate. Despite this, the flash June readings for the S&P Global Manufacturing, Composite, and Services Purchasing Managers’ Indexes exceeded estimates.

The futures market is betting that the Federal Reserve will cut interest rates at the September Federal Open Market Committee (FOMC) policy meeting. In the meantime, the US Dollar Index rose 0.22% to 105.82, which is bad news for commodities priced in dollars. US Treasury yields were mostly up, with the benchmark ten-year yield firming above 4.26%.

In other metal markets, July copper futures plunged $0.123, or 2.7%, to $4.4385 per pound, July platinum futures advanced $12.40, or 1.26%, to $996.70 an ounce, and July palladium futures tacked on $7.00, or 0.67%, to $922.50 per ounce.

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