Gold Ends Higher As Dollar Weakens; But Down 3.1% For Week

(RTTNews) - Gold futures snapped a four-day loss to end higher on Friday, as investors once again sought the safe haven appeal of the precious metal after the dollar weakened against a basket of major currencies on the rising tensions between Russia and the West over developements in Ukraine. Nonetheless, gold continued to remain under pressure following the Federal Reserve Chairman's comments that the central bank could raise interest rates as early as spring next year.

For the week, gold shed about 3.1 percent.

Investors continued to mull over the U.S. Federal Reserve Chief Janet Yellen's statement that the central bank may raise its benchmark interest rate in about a year. This indicates the bond buying program could be wound down in six months, with a possible rate hike six months later if the economy grows according to the latest Fed projections.

Gold for April delivery, the most actively traded contract, gained $5.50 or 0.4 percent to close at $1,336.00 an ounce on the Comex division of the New York Mercantile Exchange on Friday.

Gold for April delivery scaled an intraday high of $1,343.00 and a low of $1,328.00 an ounce.

Yesterday, gold ended lower as investors assessed U.S. Federal Reserve Chief Janet Yellen's comments on its benchmark interest rate and as well on some largely upbeat economic data from the U.S. Gold's recent rally fizzled out this week, as Federal Reserve Chairman made some confusing remarks about possible interest rate hikes next year.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, remained unchanged at 812.78 tons from from its previous close 816.59 tons.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 80.12 on Friday, down from its previous close of 80.19 late Thursday in North American trade. The dollar scaled a high of 80.23 intraday and a low of 80.03.

The euro traded lower against the dollar at $1.3797 on Friday, as compared to its previous close of $1.3779 late Thursday in North America. The euro scaled a high of $1.3811 intraday and a low of $1.3766.

In economic news from Europe, U.K.'s budget deficit exceeded expectations in February with public sector net borrowing excluding interventions rising to GBP 9.3 billion, compared to GBP 9.2 billion registered a year ago. The budget deficit was seen at GBP 8.6 billion.

Meanwhile, Fitch Ratings on Friday maintained the 'AAA' ratings of the United States of America and the 'stable' outlook on the country's ratings, dismissing concerns over a possible downgrade in March. The action resolved the Rating Watch Negative on which the ratings were placed last October, in line with Fitch's previous guidance that this would take place by end-March.

At the same time, rating agencies Standard and Poor's and Fitch lowered their rating outlook on Russia as the U.S. and the European Union imposed sanctions on the country after its controversial annexation of Ukraine's autonomous region of Crimea. The reduction of the outlook from Stable to Negative reflects concerns over the potential impact of the sanctions on Russia's creditworthiness.