Dollar Strength Drives Gold Prices Down 2% This Week

Gold prices ticked up on Friday but were set to post a weekly loss due to a stronger dollar and growing expectations that the Federal Reserve will keep interest rates elevated to contain inflation.

Spot gold rose 0.2 per cent to US$4,288.36 per ounce by 0200 GMT, but was down two per cent so far this week. US gold futures edged 0.6 per cent higher to US$4,323.10.

The dollar's strength made greenback-priced metals more expensive for holders of other currencies, while US Treasury yields extended gains.

Analysts said the focus will remain on the interest rate situation, as markets price in a more hawkish Fed and strengthen the dollar at gold's expense.