Gold kept in check amid elevated dollar, yields; US jobs data on tap

Spot gold fell 0.1% to $1,875.76 per ounce, as of 0525 GMT, while US gold futures were steady at $1,875.60

Gold prices were subdued on Friday and looked set for a third straight weekly loss as the US dollar and Treasury yields rallied on a hawkish US Federal Reserve stance, with investors awaiting US jobs data due later in the day.

Spot gold fell 0.1 per cent to $1,875.76 per ounce, as of 0525 GMT, while US gold futures were steady at $1,875.60.

The dollar was headed for a fifth winning week as benchmark US Treasury yields held near their highest levels since November 2018.

There are several opposing catalysts at play for gold in the likes of a tight monetary outlook driving bond yields and a stronger dollar, and that is being pitted against stagflation risks boosting its safe-haven status and appeal as an inflation hedge, said Yeap Jun Rong, a market strategist at IG.

"With that, gold prices seem to be undergoing a period of indecision until one of the driving forces take greater control of prices."

Investors now eye US non-farm payrolls data for April to assess its impact on monetary policy. Fed on Wednesday raised its benchmark rate by half a percentage point, the most in 22 years.

"I would not be surprised to see another above-consensus wage print, and this may not be good for bullion as the market would read those tea leaves as a sign of improving the odds for a 75 bp point hike at the July FOMC meeting," said Stephen Innes, managing partner at SPI Asset Management.

Non-yielding gold tends to fall out of favour among investors when interest rates rise. Equities tumbled as investors expressed concerns that rising interest rates could hurt global economic growth. With the market back into selling everything mode, it seems like "don't fight the Fed is back in play," Innes said.

Silver slipped 0.5 per cent to $22.39 per ounce, platinum slid 2.7 per cent to $954.32 and palladium fell 0.4 per cent to $2,178.82.