By Barani Krishnan

After a slight bounce Friday, gold settled just below $1,800 per ounce, although it lost almost 2% in the week, its largest weekly drop since November.

The yields on U.S. Treasury bonds soared to two-year records, while the dollar fell but remained close to its recent highs. However, gold displayed resilience during its most recent session. This could indicate that the U.S. was running at an accelerated pace of inflation.

Gold futures’ most active contract on New York’s Comex, , settled up $8.20, or 0.5%, $1,797.40. For the week, it fell 1.7% after Thursday’s slump of almost 2%.

“Gold had a bad week, but it could have been much worse when you consider the went from 1.53% to 1.75%,” Ed Moya, analyst at online trading platform OANDA said, in a post made just before the benchmark yield rate went to January 2020 highs of 1.79%.

While gold labored below the $1,800 level and the 50- and 200-day simple moving averages, “a continued selloff seems less likely”, Moya, said. But he conceded that “if bearishness resumes next week, buyers could emerge at the $1770 area.”

Gold’s Achilles heel has been the $1,830 resistance, which it has tried in vain to crack numerous times since November.

It made another attempt at this on Wednesday, just before the release of the Federal Reserve meeting minutes for December that indicated the first pandemic-era U.S. rate hike might come as early as March — spelling a boon for the Treasury yields and the dollar and gloom for safe-havens such as gold.

To rein in inflation’s fastest growth for more than a century, the Fed is accelerating its rate tightening.

Rate hikes almost always mean bad news for gold. Gold closed down last year at 3.6%, the first time it had fallen in three consecutive years.

But some analysts think that if the U.S. inflation theme remains strong through 2022, then gold could rebound, and even retrace 2020’s record highs above $2,100 — which, incidentally, came on the back of concerns about soaring price pressures.