Gold set for weekly gain on bets of US Fed pause

GOLD prices were flat on Friday (May 5) but set for their biggest weekly gain in nearly two months, as hopes of a pause in the US central bank’s interest rate hike cycle and banking worries bolstered the appeal of the safe-haven metal. Spot gold was little changed at 2,048.81 per ounce by 0039 GMT, but it was up about 3 per cent for the week. US gold futures were up 0.1 per cent at US$2,057.10. The US Federal Reserve on Wednesday signalled a likely pause in interest rate hikes. PacWest Bancorp is exploring strategic options, including a potential sale or capital raise after a liquidity boost it announced in March failed to inspire confidence in its ailing share price. Economic uncertainty and lower rates boost demand for the zero-yield asset. The dollar index was set for a weekly drop, making gold more attractive for overseas buyers. Investors will keep a tab on the US Labor Department’s non-farm payrolls (NFP) data due at 1230 GMT. The European Central Bank slowed the pace of its rate increases on Thursday but signalled more tightening to come. Lofty prices have tarnished bullion demand in top Asian retail hubs. Spot silver fell 0.3 per cent at US$26.00 per ounce, platinum gained 0.3 per cent to US$1,042.15 and palladium edged 0.6 per cent higher to US$1,456.73. REUTERS