Mumbai, Mar 14 : Gold prices edged lower on Friday, heading toward a second consecutive weekly decline as a stronger US dollar and ongoing inflation concerns reduced investor appetite for the precious metal. Market sentiment was also influenced by geopolitical tensions linked to the Iran conflict, which has complicated expectations for interest-rate cuts by the Federal Reserve.
Spot gold dropped about 0.5 percent to $5,052.15 per ounce during afternoon trading in the United States, leaving the metal down more than two percent for the week. Meanwhile, US gold futures for April delivery settled 1.3 percent lower at $5,061.70.
Market analysts noted that although long-term demand for gold remains strong due to portfolio diversification and safe-haven appeal, the strengthening dollar has weighed heavily on prices in the short term. Independent metals trader Tai Wong said bullion has been drifting toward lower levels since the start of the Iran conflict as the US currency approaches multi-month highs.
A stronger dollar typically makes gold more expensive for buyers using other currencies, limiting global demand. Analysts at Commerzbank also highlighted that expectations of tighter monetary policy have added further pressure on the metal.
Economic data showing resilient consumer spending in the United States, alongside persistent inflation, has strengthened predictions that the Federal Reserve may delay further rate cuts. Higher interest rates generally reduce the attractiveness of non-yielding assets such as gold by raising the opportunity cost of holding them.
Geopolitical developments also remained in focus after US President Donald Trump signalled tougher action against Iran in the coming days, even as the administration issued a temporary waiver related to purchases of sanctioned Russian oil.
In the broader precious metals market, other commodities also declined. Spot silver dropped 3.3 percent to $81 an ounce, while platinum fell four percent to $2,047.20 and palladium slipped 2.5 percent to $1,569, with both metals also heading for weekly losses.