Gold muted as U.S. jobs data raises doubts over Fed rate-hike path

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Gold prices were steady on Monday, having

posted their best day in a month in the last session after a

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U.S. jobs report showed unemployment rising in August,

suggesting the Federal Reserve might slow the pace of rate


Spot gold was flat at $1,710.88 per ounce by 0523

GMT. U.S. gold futures were little changed at $1,723.10.

Gold rose as much as 1.3% on Friday after data showed U.S.

employers hired more workers than expected in August, but

moderate wage growth and a rise in the unemployment rate to 3.7%

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suggested the labor market was starting to loosen.

“With the Fed meeting just over two weeks away and their

‘blackout period’ fast approaching, any comments from Fed

members this week will be scrutinized by traders as they have

the ability to move the needle on Fed policy,” said Matt

Simpson, a senior market analyst at City Index.

“Any comments alluding to a 75 bp hike could keep gold

prices under pressure.”

Fed’s next policy meeting is scheduled for Sept. 20-21.

“Gold gained on Friday as more Americans returned to the

workforce. Any easing of the tight labor market will help the

Fed tame inflation and potentially reduce its need to tighten

rates aggressively,” ANZ said in a note.

Gold tends to perform badly amid a high-interest rate

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environment as it yields no interest.

The dollar index hit a 20-year high, making gold

expensive for holders of other currencies.

Speculators cut net long position in COMEX gold by 9,599

contracts to 20,726 in the week to Aug. 30, while net short

position increased in COMEX silver, the U.S. Commodity Futures

Trading Commission (CFTC) said on Friday.

Spot silver was flat at $18.02 per ounce, platinum

rose 0.2% to $836.50 per ounce, while palladium

gained 0.7% to $2,037.50.

Stronger-than-expected platinum shipments to China in the

first half of the year spurred shortages elsewhere, as supply

declined from mines and recycling, the World Platinum Investment

Council said.

(Reporting by Ashitha Shivaprasad and Eileen Soreng in

Bengaluru; Editing by Maju Samuel)

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