The U.S. Dollar Is Falling As Gold Prices Approach A 6-Week High.

When the U.S. dollar fell on Friday due to speculation that the Federal Reserve may be reaching the end of its cycle of interest rate hikes, gold prices increased to trade just below a 6-week high achieved earlier this week.

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Price movement

• On the Comex, gold futures for April delivery rose $16.70 or 0.9% to $1,940 per ounce (GC00, 1.88%; GCJ23, 1.89%).
• Silver futures for May delivery rose by 30 cents, or 1.4%, to $21.99 per ounce (SI00, 2.62%; SIK23, 2.62%).
• Palladium futures for June PLN23, -0.14% rose by $7.20, or 0.5%, to $1,416 per ounce, while platinum futures for April PAM23, -1.80% gained $23.10, or 2.3%, to $999.40 per ounce.
• The May HGK23, 0.39% copper futures price jumped by 7 cents, or 1.9%, to $3.94 a pound.

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Market Forces

Gold is gaining from the belief that the Federal Reserve may conclude its cycle of interest-rate hikes now at meeting next week, giving one final 25 percentage point hike before remaining steadfast, according to precious metals analysts.

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"There is considerable anticipation that the Fed will act similarly to the ECB next week and hike rates as anticipated before pausing. The US dollar has taken a beating due to anticipation that the Fed is reaching the conclusion of its tightening cycle, according to Raffi Boyadjian, head investment analyst at XM.

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On Thursday, the ECB increased its key interest rate by 50 basis points, but it reneged on its forward guidance, indicating that further increases will depend on the state of the economy's statistics. Some have said that the biggest central bank in Europe may be having second thoughts due to concerns over the health of American regional banks and Swiss lender Credit Suisse, which recently agreed to borrow $50 billion from the Swiss National Bank.

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The U.S. dollar was under pressure due to expectations that the Fed's policy interest rate wouldn't go above 5%, a situation that normally favors gold.

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The ICE U.S. Dollar Index DXY, -0.28%, which measures the strength of the dollar against a group of other currencies, fell 0.2% to 104.19.