Gold hits highest level since August as dollar drops to two-month low

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Gold futures closed the week at their highest since mid-August, edging up 0.9% Friday and +5.6% for the week to $1,766/oz, as resurgent hopes that the Federal Reserve might slow the pace of interest rate hikes helped lift the metal and drop the U.S. dollar index to its lowest in more than two months.

Also, front-month Comex silver closed +4.1% to $21.646/oz this week.

ETFs: (NYSEARCA:GLD), (NYSEARCA:GDX), (GDXJ), (IAU), (NYSEARCA:NUGT), (PHYS), (SIL), (SLV), (SIVR)

Although gold still is down ~3.3% YTD it has now gained in five of the past seven weeks, and the week just ended was the yellow metal's largest one-week net and percentage gain since April 2020.

Meanwhile, the U.S. dollar index dropped more than 4% on the week, driven largely by the October consumer price index data released Thursday, which helped raise expectations that the dollar may have reached its peak.

The dollar index continued lower after data Friday showed the University of Michigan's gauge of U.S. consumer sentiment slid 5.2 index points in November from 59.9 in October.

Next week, the focus for gold will turn to growth, with data on retail sales from China and the U.S., and GDP from the Eurozone, Forex.com analyst Fawad Razaqzada told MarketWatch.

A week ago after Fed Chairman Jerome Powell signaled the central bank was not finished raising rates, gold futures fell to their lowest levels in two-and-a-half years.