Gold Gains Weekly for the First Time in Six Weeks; Prices Remain Below $1,700

As the yellow metal's five-week losing streak came to an end, gold bulls achieved their first weekly victory since early June.

As markets prepare for the Federal Reserve's rate hike in July, analysts say the price of an ounce of gold, which is now hovering in the low $1,700s, may be susceptible to another slide below the $1,600 zone next week.

Analysts predict that if bullion maintains the tendencies of the last two days, it might rebound quickly from any dip into the sub-$1,700 range, propelling it to $1,800.

Ed Moya, head of U.S. research at the online trading platform OANDA, observed, "Gold is beginning to act as a safe haven as slowing economic growth compels many central banks to abandon aggressive tightening plans." "Gold may find resistance at $1,750, but if it does not, it will encounter few impediments until $1,800."

Gold futures for August delivery on the New York Comex gained $14, or 0.8 percent, to $1,727.40 per ounce on Friday, after trading around a 16-month low of $1,680.96 per ounce on Thursday.

After a five-week fall that cost bulls $172, or 9 percent, gold prices increased by 1.4 percent during the week of August.

On Friday, the Dollar Index, which compares the dollar to six major currencies, reached a two-week low of 105.98, causing the weekly rise. Unlike gold, the dollar reached its highest level since December 2002 last week, reaching 109.14.

Since the beginning of this week, the greenback has dropped, and its decline accelerated as the European Central Bank joined numerous other central banks on Thursday in raising interest rates to combat runaway inflation rather than prevent an economic recession.

The dollar declined on Friday as weaker-than-anticipated statistics from the U.S. services sector impacted on the currency's sentiment. S&P Global said that its most recent services sector index declined to 47 from a previous reading of 52.7 and a forecast of 52.6.

Contrary to initial forecasts, poor service statistics have increased the chance that the Fed would not raise interest rates by 100 basis points in July.