Gold falls but weak dollar helps curb losses

Gold prices fell during the European session on Friday, to hit pause for the first time in 3 days on weak haven demand, after signicent thaw in the Brexit file, but losses were limited on the continuous retreat in the dollar against major currencies.

Gold fell by 0.3% to $1,487.44 an ounce, from the opening of $1,491.99, with a session-high of $1,494.08.

The metal gained 0.2% yesterday, its second daily gain, supported by a retreat in the US dollar.

Demand on safe-havens weakened this week, amid positive developments in the Brexit file and a robust start of the US corporate earnings season.

The European Union leaders agreed with the UK on a Brexit deal during the EU economic summit in Brussels yesterday, which provides the UK with the chance of leaving in orderly fashion on October 31.

However, the deal still have a major hinder in its way before entering into force, which is the British parliament vote on the draft deal on Saturday, and if the British lawmakers rejected it, the UK would likely face a chaotic exit.

Otherwise, the dollar index fell by 0.1%, to extend its losses for the fourth day, on the cusp of touching its 2-month low of 97.50 points, and reflecting the lingering US dollar drop against major currencies.

The US dollar fell this week, as sentiment in Europe rose, following positive developments around the British secession, which increased investor buying of euro and pound currencies at the expense of the US currency.

The greenback suffered sharp losses during this week after it lost its charm in the Forex market as the latest developments in the Brexit file spurred demand levels on euro and sterling.

Gold holdings at the SPDR Gold Trust, stayed unchanged yesterday, with a total of 918.19 mt (the lowest since September 23rd).