On the commodities exchange, COMEX gold was quoted at 5,117.40 an ounce, down 8.40 points or 0.16%. COMEX silver was trading at 84.5 an ounce, lower by 0.522 points or 0.61%.
Despite the marginal intraday moves, bullion prices are on track to post their second consecutive weekly decline, weighed down by a strengthening US dollar and higher US Treasury yields.
A stronger US dollar increases the cost of dollar-denominated commodities for buyers using other currencies.
US Treasury yields have also moved higher, reaching their highest levels since August, after recent economic data indicated resilience in the labour market. The latest US jobless claims figures showed that new applications for unemployment benefits remained subdued.
Following the data, traders scaled back expectations of near-term interest rate cuts by the US Federal Reserve.
Market pricing indicates almost no probability of a rate cut at the next policy meeting, with expectations for easing later in the year also moderating. Higher interest rates generally reduce the appeal of non-yielding assets such as gold.
Geopolitical tensions support oil prices
Meanwhile, developments in the WestAsia have kept energy markets volatile. The conflict involving the US, Israel and Iran has disrupted shipping through the Strait of Hormuz, a key route for global oil trade.
Crude oil prices have climbed to their highest closing levels since August 2022, amid concerns over supply disruptions. The International Energy Agency said the conflict has led to the largest supply disruption in the history of the global oil market, prompting member countries to release a record 400 million barrels from emergency reserves.
Gold retains strong yearly gains
Despite the recent pullback, gold has gained about 18% so far this year and continues to trade above the $5,000 per ounce level.
Analysts say movements in the dollar, bond yields and geopolitical developments are likely to remain key drivers for precious metals in the near term.
–With Bloomberg inputs
