Gold prices fell Friday, pushed down by expectations that the dollar’s rally will continue weighing on commodities.
Gold for August delivery was recently down 0.4% at $1,242.30 a troy ounce on the Comex division of the New York Mercantile Exchange. Prices fell as low as $1,236.20 a troy ounce earlier in the session.
The WSJ Dollar Index, which measures the U.S. currency against a basket of 16 others, is up nearly 3% this year. Those gains have pressured commodity prices, which are denominated in the U.S. currency and become more expensive to foreign buyers when the dollar rises. Robust consumer price growth in the U.S. has bolstered the case for the Federal Reserve to raise rates at a faster pace, a move that could boost the dollar further.
Gold also struggles to compete with yield-bearing investments when rates rise, another reason why expectations of tighter monetary policy tend to hurt the metal.
In base metals, September copper was unchanged at $2.7760 a pound.
Write to Ira Iosebashvili at firstname.lastname@example.org