Gold slips and heads for worst week since NovemberGold lost its shine on Friday, with prices heading for their worst week since November tracking the dollar's strength even as the Russia-Ukraine conflict continues to escalate.But deepened volatility theme essentially held through the week even as an increase in flight-to-safety bets helped the dollar hurting bullion demand internationally.Spot gold slipped 0.5 per cent to about $1,9300 per ounce, and US gold futures fell 0.5 per cent to about $1,930."These - gold and the dollar - are very choppy, headline-driven markets, so we could see plenty more action throughout the day in both directions," Craig Erlam, senior market analyst at OANDA, to Reuters, adding apparent progress in Russia-Ukraine talks was essentially behind gold's weekly dip.Gold has lost over 2.5 per cent this week, with markets rushing to reprice US Federal Reserve's rate hike trajectory after the central bank's projections based on the dot plots showed policymakers pencilled in six rate hikes for this year.Gold is usually used to hedge during an economic crisis and high inflation scenarios.
Still, higher interest rates and the expected interest rate differential between the US and the rest of its peers are expected to keep the dollar well bid.While the yellow metal recovered somewhat after the Fed said it raised borrowing costs along expected lines, the central bank acknowledged the risk of soaring inflation as oil supply concerns remain from the escalating Russia-Ukraine conflict."Gold will remain well supported.
As the demand for safe havens and inflation hedges remains strong," Mr Erlam said, we could increasingly see dips being bought into.Spot palladium rose over 2 per cent to about $2,570 per ounce but was set for a weekly fall of nearly 9 per cent as fears about supply from top producer Russia also eased.Meanwhile, China's intent to tackle COVID-19 with minimal impact on the economy and people's lives, and promise of further stimulus, have brought palladium bulls back to the table, said Matt Simpson, senior market analyst at City Index.This follows many sessions of volatile price action that saw platinum, palladium and key metals drop to technical support levels after sharp rallies.