Gold extends losses on US interest rate-hike fears

[BENGALURU] Gold edged lower on Monday (Jun 8), extending losses from the previous session on US rate-hike concerns, while renewed hostilities in the Gulf pushed oil prices higher, fanning inflation concerns.

Spot gold fell 0.2 per cent to US$4,321.49 per ounce by 0124 GMT. Prices fell about 3 per cent on Friday, hitting the lowest since Mar 24, as a stronger-than-expected US jobs report raised bets for interest rate hikes.

US gold futures for August delivery were down 0.5 per cent at US$4,345.60.

US President Donald Trump said on Sunday he would tell Israeli Prime Minister Benjamin Netanyahu not to strike back after Iran fired a salvo of missiles at Israeli targets in retaliation for an attack on the outskirts of Beirut, news outlet Axios reported.

Oil prices rose more than US$2 a barrel on Monday, deepening concerns over inflation and interest rate hikes.

Cleveland Federal Reserve president Beth Hammack said on Friday that new jobs numbers show the labour market was roughly in balance and near full employment, while continued high inflation may require the Fed to raise interest rates soon to contain it.

The US economy posted a third straight month of strong job gains in May, confirming the labour market was gaining traction after stumbling last year and giving the Fed more room to keep rates steady amid rising inflation due to the Iran war.

China’s central bank increased its gold reserves for a 19th month in May, data from the People’s Bank of China showed on Sunday, with the country’s gold reserves rising to 74.96 million fine troy ounces.

Gold demand was subdued in India last week as buyers stayed on the sidelines due to volatile overseas prices, while premiums in China eased slightly.

SEE ALSO

Gold steadies as uncertainty surrounds progress in US-Iran talks

Gold speculators raised net long positions by 14,409 contracts to 111,341 in the week to Jun 2.

Spot silver fell 0.4 per cent to US$67.52 per ounce, platinum lost 0.2 per cent to US$1,773.69, while palladium rose 0.5 per cent to US$1,231.51. REUTERS