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Gold briefly tops key $2,000 mark again
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Silver set for weekly gain
(Recasts, adds analyst's comments, updates milestones and
prices)
By Seher Dareen
March 24 (Reuters) - Gold dipped on Friday in a volatile
week that saw bullion prices north of the key $2,000 figure as
bank contagion fears bolstered both safe-haven demand and bets
on a pause in Federal Reserve rate hikes.
The U.S. dollar rose about 0.5%, making the
greenback-priced gold more expensive among overseas buyers on
Friday. Spot gold fell 0.8% to $1,977.01 per ounce by 2:34
p.m. EDT (1834 GMT), after it rose to $2,002.89 earlier in the
session. U.S. gold futures slipped 0.6% to settle at
$1,983.80.
A somewhat firmer dollar and a rebound in equity markets
and risk appetite are probably what has driven gold lower, said
Bart Melek, head of commodity markets strategy at TD Securities.
But bullion was likely to get continued support from big macro
developments, Melek said. Rescue measures for struggling banks eased contagion fears
earlier in the week, putting gold on course for its first weekly
decline in four, down about 0.5%, despite having climbed to its
highest in a year above $2,000 on Monday.
But banking shares were trounced again on Friday, with
European giants Deutsche Bank and UBS knocked by worries that
regulators and central banks have yet to contain the worst shock
to the sector since the 2008 financial crisis. "Any concern that pops up about U.S. banks being
undercapitalized is going to be a factor for gold to rise," said
Bob Haberkorn, senior market strategist at RJO Futures.
Fed officials said there was no indication financial
stress was worsening as they gathered at a policy meeting this
week, a fact that allowed them to stay focused on lowering
inflation with another interest rate increase.
The U.S. central bank this week raised rates by an expected
quarter of a percentage point but signalled it was on the verge
of pausing.
Silver eased 0.1% to $23.07, platinum fell
0.7% to $977.776, and palladium dropped 0.7% to
$1,420.40.
(Reporting by Seher Dareen, Bharat Govind Gautam and Rahul
Paswan in Bengaluru; Editing by Kirsten Donovan and Shilpi
Majumdar)