Bengaluru — Gold prices edged lower on Monday as investors booked profits after a sharp rise in the previous session on weaker-than-expected US jobs data that boosted the expectation for a US Federal Reserve interest rate cut in September.
Spot gold lost 0.1% to $3,360.62/oz 4.32am GMT. Bullion rose more than 2% on Friday. However, US gold futures gained 0.4% to $3,412.80.
“Gold has made a conservative start to the week following Friday’s price jump. A combination of profit-taking and dollar stabilisation has caused gold to ease marginally to kickoff the week,” KCM Trade chief market analyst Tim Waterer said.
Last week, nonfarm payrolls increased by 73,000 jobs last month, after a downwardly revised gain of 14,000 in June, the US labour department’s Bureau of Labor Statistics said. This revived hopes of a Fed rate cut in September, with markets now pricing in an 81% chance, per CME FedWatch tool.
The tariffs US President Donald Trump imposed last week on scores of countries were likely to stay in place rather than be cut as part of continuing negotiations, trade representative Jamieson Greer said on CBS show Face the Nation, aired on Sunday.
“But with Trump on the tariff warpath once again, and the soft US jobs report increasing the odds that we could see a September FOMC [Federal open market committee] rate cut, any pullbacks in the precious metal could be of a shallow nature,” Waterer said.
Gold, traditionally considered a safe-haven asset during political and economic uncertainties, tends to thrive in a low-interest-rate environment.
Citi raised its gold price forecast over next three months to $3,500/oz from $3,300/oz, and the expected trading range to $3,300/oz-$3,600/oz from $3,100/oz-$3,500/oz, on the belief that near-term US growth and inflation outlook has deteriorated.
Spot silver rose 0.2% to $37.10/oz, platinum slipped 0.6% to $1,307.52 and palladium eased 0.6% to $1,201.44.
Reuters
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