Gold Pressured by Hawkish Fed and Stronger Dollar

Gold prices extended their decline, marking a third consecutive week of losses as markets continued to reprice expectations for Federal Reserve policy. The Fed's commitment to keeping interest rates higher for longer has bolstered the US Dollar and Treasury yields, diminishing the appeal of non-yielding bullion.

Broad US Dollar Strength Dominates Currency Markets

The U.S. Dollar continued its broad-based rally, supported by expectations of a restrictive monetary policy stance from the Federal Reserve. This strength was evident against multiple currencies, with the dollar advancing against the Canadian and New Zealand dollars, while its momentum against the Japanese Yen, Euro, and British Pound saw some moderation.

Diverging Central Bank Policies Create Varied FX Moves

Beyond the Federal Reserve's influence, differing monetary policies from other central banks are impacting specific currency pairs. The Swiss Franc has notably weakened due to policy divergence with the Fed, while the Australian Dollar has remained in a tight range as hawkish outlooks from both the Reserve Bank of Australia and the Fed offset each other.