Gold prices climbed to $2,350 per troy ounce on Friday as the US dollar index (DXY) retreated from recent highs following weaker-than-expected US economic data, boosting demand for the precious metal.
Dollar Weakness Drives Gold Higher
The DXY index fell 0.5% to 103.80 after US retail sales came in below expectations for the second consecutive month. A weaker dollar makes gold cheaper for holders of other currencies, typically supporting demand.
XAU/USD rose 1.2% to $2,352.40, its highest level since early March. Trading volume was notably elevated, with gold futures on COMEX seeing heavy buying from institutional investors.
Central Bank Buying Continues
Underlying demand from central banks globally has provided a strong floor for gold prices throughout the year. Emerging market central banks, particularly from China, India, and Turkey, have continued adding to their gold reserves as part of de-dollarization efforts.
“Gold’s fundamental backdrop remains very constructive. Central bank demand, geopolitical uncertainty, and the eventual Fed pivot to rate cuts all point to higher prices.” โ Precious Metals Analyst
Technical analysts note that a sustained break above $2,350 would open the door to a test of the all-time high around $2,430.