Gold Prices Rally On Short Covering Kitco News - Gold prices are posting good gains in mid-morning U.S. trading Friday, on short covering and perceived bargain hunting heading into the weekend. Gold did see a brief, mild sell off following a better-than-expected reading on the U.S. economy, but prices quickly recovered. June gold futures were last up $8.60 an ounce at $1,288.10. May Comex silver was last up $0.106 at $14.98 an ounce.
The U.S. economic highlight of the week saw the first estimate on first-quarter gross domestic product come in at up 3.2%, year-on-year, which is a solid miss to the upside. U.S. GDP was expected to come in at up 2.5%. The report falls into the camp of the U.S. monetary policy hawks, who would like to see U.S. interest rates rise sooner.
The U.S. dollar index sold off in the wake of the strong U.S. GDP number, which is surprising to many. However, the USDX on Thursday pushed to a two-year high and today’s price action is just a normal downside correction, especially heading into the weekend as those traders who had been long the dollar are taking some profits.
The weaker greenback and a bit of selling pressure in the U.S. stock market are also working in favor of the precious metals market bulls.
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