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Gold slipped on Friday as a stronger dollar dulled its appeal and pushed the metal further from one-month highs hit in the previous session.

· Spot gold dropped 0.8% to $1,814.11 per ounce by 1:43 pm ET, though it was up 0.3% so far this week.

· U.S. gold futures settled 0.8% lower at $1,815.

· The dollar index was bound for a strong weekly gain, reducing gold’s appeal to other currency holders.

· SPDR GOLD HOLDINGS:

· TD Securities commodity strategist Daniel Ghali said gold’s inability to benefit substantially from weaker U.S. real yields suggested it remained vulnerable to a further pull-back.

“Although gold’s valuation is more attractive on a relative basis to U.S. Treasury inflation protected securities (TIPS), the reason gold is trading at a discount to it is because it does not have the same carry advantage.”

Ghali, however, said that improving physical bullion demand, particularly from top-consumer China, and central bank purchases could limit the precious metal’s declines.

· Earlier this week, Federal Reserve Chair Jerome Powell reiterated that the U.S. central bank would remain accommodative, driving gold to a one-month high on Thursday.

· Uncertainty around a potential spike in coronavirus Delta variant cases in the United States could force the Fed to remain accommodative for longer, said Phillip Streible, chief market strategist at Blue Line Futures in Chicago.

· Elsewhere palladium slid 3.2% to $2,644.20 an ounce, en route to its first weekly decline in four.

· Platinum lost 2.9% to $1,105.03.

· A U.S. retail sales report for June showed motor vehicles sales declined because of a lack of supply caused by a global semiconductor shortage.

“The auto shortage will probably linger for a while and perhaps that’s causing palladium and platinum prices to struggle a bit,” ED&F Man Capital Markets analyst Edward Meir said.

The two metals are used by automakers to limit emissions in engine exhaust systems.

· Silver shed 2.3% to $25.71 an ounce.

· Fed's Kashkari says many U.S. sectors struggling to adjust to reopening

Minneapolis Federal Reserve President Neel Kashkari said many U.S. economic sectors faced rapidly rising prices and were struggling to adjust to reopening after the shutdown.

"Basically, what's happening is the U.S. economy went through a very abrupt shutdown a year ago," Kashkari told NPR in an interview published on Saturday.

· U.S. consumer sentiment drops in early July on inflation fears

U.S. consumer sentiment fell sharply and unexpectedly in early July to the lowest level in five months as inflation worries dented confidence in the economic recovery, a survey showed on Friday.

The University of Michigan said its preliminary consumer sentiment index fell to 80.8 in the first half of this month - the lowest since February - from a final reading of 85.5 in June. Economists polled by Reuters had forecast the index would rise to 86.5.

· U.S. business inventories rise in May; autos stocks decline

Business inventories rose 0.5% after edging up 0.1% in April, the Commerce Department said on Friday. Inventories are a key component of gross domestic product. May's increase was in line with economists' expectations.

· U.S. warns companies about the risks of doing business in Hong Kong as China clamps down on rights

The Biden administration on Friday warned businesses with operations in Hong Kong of sweeping financial and regulatory risks as China continues to restrict political and economic freedoms in the territory.

· Britain sets out plan to stimulate trade with developing economies

Britain will set out a plan on Monday to stimulate trade with 70 developing economies by lowering tariffs and simplifying rules, its latest push to promote freer global commerce after regaining control of its trade policy following Brexit.

· CORONAVIRUS UPDATES:

· A surge in Covid-19 cases across the continent caused by the highly-transmissible delta variant continues to weigh on investor sentiment, with several major European countries forced to reimplement social restrictions, while the U.K. will take the gamble of removing its last layer of safeguards from Monday.

· The U.K. reported 51,870 new coronavirus cases Friday, marking the first time since mid-January that daily infections have risen above 50,000.

· PM Johnson pleads for caution as 'Freedom Day' arrives in England

The strategy comes with risks - most notably that a variant capable of resisting vaccines could emerge, or that the caseload could grow so severe that the economy grinds to a halt. Given that, Johnson has urged the public to take a cautious approach to the reopening.

· Tokyo Olympics athlete Covid-19 infections rise to three

Infection rates are climbing among the general population of the capital, topping 1,000 new cases for four consecutive days.

· Singapore announces separate Covid rules for people who are vaccinated

Only fully vaccinated individuals and people who have recovered from Covid-19 will be able to dine in in groups of five without taking Covid tests when the new rules kick in on July 19.

Reference: CNBC, Reuters, Worldometers