Gold posts third weekly fall

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Gold prices closed near a one-month low on Friday and posted its third consecutive weekly dip, as the dollar and bond yields strengthened after data showed US producer prices increased in July.

After dropping to its lowest level since July 7 earlier in the session, spot gold was little changed at $1,913.35 per ounce. Bullion was down 1.4 percent so far this week.

US gold futures settled 0.1 percent lower at $1,946.60.

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“The producer price index came a bit hotter than expected, that pushed up Treasury bond yields and boosted the US dollar index a little bit. So that put a little bit of pressure on the gold market,” said Jim Wyckoff, senior market analyst at Kitco.

“We’re also seeing technical selling in both gold and silver because the charts have turned more near-term bearish in the past couple of weeks.”

The US producer price index for final demand rose 0.3 percent last month, the Labor Department said. In the 12 months through July, the PPI increased 0.8 percent .

Economists polled by Reuters had forecast the PPI would climb 0.2 percent for the month and advance 0.7 percent on a year-on-year basis.

The dollar gained 0.3 percent against its rivals and was on track for its fourth consecutive weekly gain, making gold more expensive for other currency holders. Benchmark 10-year yields also gained for the fourth straight week.

On Thursday, data showed US consumer prices increased moderately in July, lifting hopes that the Federal Reserve is at the end of its interest rate hike cycle.

Rising US interest rates increase the opportunity cost of holding non-yielding bullion.

Spot silver slipped 0.1 percent to $22.66 an ounce and platinum gained 0.4 percent to $910.06. Both were on track for their fourth consecutive week of losses.

Palladium rose 0.9 percent to $1,298.19 per ounce. -Reuters

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