Gold edges lower as US jobs data dents rate-cut expectations
Bullion hit a record high of US$4,381.21 on Oct 20, but it has fallen close to 10% since
[BENGALURU] Gold dipped on Thursday (Nov 6) after stronger-than-expected private US payrolls data dented expectations of another interest rate cut by the US Federal Reserve in December.
Spot gold lost 0.3 per cent to US$3,971.08 per ounce by 9.44 am.
US gold futures for December delivery lost 0.3 per cent to US$3,979.70 per ounce.
The US dollar held just below a four-month high reached in the previous session, with a recovery in appetite for riskier assets pulling it off recent peaks.
Meanwhile, benchmark US 10-year yields held just below their highest in nearly a month.
The US Federal Reserve cut interest rates last week and chair Jerome Powell suggested it might be the last reduction in borrowing costs for the year.
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US private employment increased by 42,000 jobs last month, above Reuters’ estimate of a 28,000 rise, the ADP employment report showed on Wednesday. A strong jobs market typically makes interest rate cuts less likely and can keep rates higher for longer.
Market participants now see a 62 per cent chance of a Fed rate cut in December, down from over 90 per cent last week.
A congressional impasse has resulted in what is now the longest-ever US government shutdown, which has forced investors and the data-dependent Fed to rely on private sector indicators.
Non-yielding gold tends to do well in a low-interest-rate environment and during times of economic uncertainty.
Bullion hit a record high of US$4,381.21 on Oct 20, but it has fallen close to 10 per cent since.
Major stock indexes gained on Wednesday as corporate earnings and US private payrolls data were stronger than expected.
Elsewhere, US Supreme Court justices raised doubts on Wednesday over the legality of President Donald Trump’s sweeping tariffs in a case with implications for the global economy.
Elsewhere, spot silver was down 0.6 per cent at US$47.77 per ounce, platinum slid 0.8 per cent to US$1,549.21 and palladium lost 0.7 per cent at US$1,408.74. REUTERS
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