Gold holds steady, on track for first weekly gain in four

GOLD prices held steady on Friday, and were on track for their first weekly gain in four, despite falling over 1 per cent in the previous session after the US Federal Reserve projected just one interest rate cut this year.

Spot gold was unchanged at US$2,303.43 per ounce, as of 0134 GMT. Bullion gained 0.5 per cent so far for the week. US gold futures held steady at US$2,318.50.

Fed policymakers, on Wednesday, pushed out the start of rate cuts to perhaps as late as December, implying they will lower rates only once this year, dashing hopes of two cuts and despite some progress in controlling inflation.

Lower interest rates reduce the opportunity cost of holding non-yielding bullion.

US producer prices unexpectedly fell in May amid lower energy costs, indicating that inflation subsided after surging in the first quarter.

Gold Fields lowered its annual production forecast after bad weather impacted the ramp-up at its new Salares Norte mine in Chile.

Spot silver fell 0.5 per cent to US$28.985 per ounce, platinum was up 0.7 per cent at US$953.43 and palladium gained 0.8 per cent to US$889.84. REUTERS