Gold firms on softer dollar, investors await US jobs data

[BENGALURU] Gold prices were underpinned by a subdued dollar on Tuesday, with investors looking ahead to US non-farm payrolls data, which could be key to the Federal Reserve's tapering decision.

Spot gold rose 0.1 per cent to US$1,812.27 per ounce by 1.16am GMT.

US gold futures were up 0.2 per cent at US$1,816.00.

The dollar hovered near two-week lows against a basket of currencies, steadying from falls after Fed chief Jerome Powell gave no signal regarding the central bank's tapering timeline except that it could be "this year".

Gold is considered a hedge against inflation and currency debasement in the wake of massive stimulus measures.

Cleveland Fed president Loretta Mester said the US economy is recovering strongly but she is not yet convinced that recent inflation readings will be enough to satisfy the price stability goal the central bank revamped a year ago.

The US non-farm payrolls report for August is due on Friday. The market is expecting an increase of 728,000 jobs, unemployment to fall to 5.2 per cent from 5.4 per cent and average hourly earnings to rise 0.4 per cent month-on-month.

China's factory activity expanded at a slower pace in August as coronavirus-related restrictions and high raw material prices pressure manufacturers in the world's second largest economy.

Roughly 28 per cent of Brazilian gold exports in 2019 and 2020 likely came from illegal mines, a report by public prosecutors and the Federal University of Minas Gerais found, pointing to widespread forging of documents and lack of effective law enforcement.

Silver fell 0.1 per cent to US$24.03 per ounce, while platinum eased 0.3 per cent to US$1,003.89.

Palladium dropped 0.7 per cent to US$2,476.22, having risen 3.1 per cent in the previous session.

REUTERS