By Bharat Gautam

(Reuters) – Gold fell on Friday, as the dollar strengthened. Prices are on track for their worst week since nearly four months due to a cooling of some safe-haven demand sparked by Russia’s invasion in Ukraine.

As of 1002 GMT, it had fallen 0.5% to $1.932.20 an ounce. U.S. declined 0.5% to $1.933.10.

Bullion sales overseas have been affected as a result of the dollar’s strengthening. [USD/]

“These (gold) and the dollar are very volatile markets that headline-driven so we could see lots more action throughout today in both directions,” Craig Erlam of OANDA Senior Market Analyst said. He added that apparent progress was made in Russia-Ukraine discussions, which was partially responsible for gold’s weekly drop. [MKTS/GLOB]

The gold price has fallen 2.7% this week, with investors pricing in the possibility of an aggressive increase by the U.S. Federal Reserve.

High interest rates can increase the cost of non-interest-paying gold.

Bullion gained some value after the Fed stated that it would raise borrowing costs in the expected manner, while also acknowledging the difficulties presented by rising inflation.

The gold market will be well supported. Erlam indicated that dips may be more common as demand for safety havens or inflation hedges continues to grow.

Spot palladium increased 2.3% to $2567.02 an ounce. However, it was expected that there would be a weekly drop of 8.8% due to fears over Russia’s supply.

Matt Simpson from City Index is a senior market analyst and said that China’s intention to deal with COVID-19 while having minimal effect on the economy and lives of people, as well as the promise to provide further stimulation, has brought palladium bears back to the table.

This is the result of many volatile sessions that saw palladium, key metals and platinum drop to technical resistance levels following sharp rallies.[MET/L]

Spot Silver fell 0.4%, to $25.24/ounce. Platinum rose 1.5%, to $1,036.53.