Gold stalls after marking the biggest weekly profit in 2-1/5 years

Gold prices fell in European trade away from three-month highs on profit-taking after marking the largest weekly profit in 2-1/5 years. 

Prices are also pressured by a stronger dollar following remarks by Fed officials that showed continued struggle to bring inflation back towards targets.

Gold Prices Today

Gold prices fell 0.75% to $1,757 an ounce, after rising 0.85% on Friday, marking three-month highs at $1,772 an ounce as the dollar tumbles.

Large Weekly Profit

Gold prices rose 5.35% last week, the second weekly profit in a row, and the largest since March 2020 at the start of the Covid 19 pandemic.

Such gains came after recent US inflation data that showed a slowdown in consumer prices in October, hurting chances of aggressive policy tightening by the Fed.

Following the data, chances of a 0.5% rate hike by the Fed in December rose from 67% to 85%, while chances of a 0.75% hike fell from 33% to 15%.

The Dollar

The dollar index rose 0.6% on Monday on track for the first profit in three sessions away from three-month lows at 106.28 against a basket of major rivals. 

Dollar was transiently boosted by bullish remarks from Fed member Christopher Walrer yesterday, that the Fed will keep on its fight against inflation until it's completely brought down to just 2%.

The SPDR

Gold holdings at the SPDR Gold Trust fell 1.45 tones on Friday to a total of 910.12 tones.