Gold prices drifted lower on Friday as the dollar firmed up against most of its rivals.
Gold prices moved up early on in the session, riding on U.S. President-elect Joe Biden’s announcement of a $1.9 trillion stimulus package proposal and the Federal Reserve’s dovish outlook for the next one year.
Risk sentiment weakened due to worries over a rise in coronavirus infections in Europe and China, tighter lockdown restrictions in several cities across the world, and growing tensions between the U.S. and China.
The dollar index rose to 90.77, gaining nearly 0.6%.
Gold futures for February ended down $21.50 or about 1.2% at $1,829.90 an ounce. Gold futures shed about 0.3% this week.
Silver futures for March ended lower by $0.936 at $24.866 an ounce, while Copper futures for March settled at $3.6020 per pound, down $0.0625 from previous close.
Several countries across the world have tightened lockdown measures. France strengthened border controls and extended a curfew to the entire country on Thursday to combat the virus as the situation remains worrying.
China has put millions of people in lockdown in response to new outbreaks of Covid-19 in the north and northeast.
Data from the Commerce Department said retail sales fell by 0.7% in December after tumbling by a revised 1.4% in November. Economists had expected retail sales to come in unchanged compared to the 1.1% slump originally reported for the previous month.
The Labor Department said its producer price index for final demand rose by 0.3% in December after inching up by 0.1% in November. Economists had expected producer prices to rise by 0.4%.
Activity in the New York manufacturing sector unexpectedly grew at a slower pace in the month of January, the Federal Reserve Bank of New York revealed in a report released today.
The New York Fed said its general business conditions index slipped to 3.5 in January from 4.9 in December, although a positive reading still indicates growth in regional manufacturing activity. Economist had expected the index to inch up to 6.0.