Gold off one-year highs as dollar firms ahead of US payrolls data
Gold prices retreated from one-year highs on Thursday as the dollar regained some ground, while investors awaited the US non-farm payrolls report to gauge the Federal Reserve's monetary policy strategy.
Spot gold fell 0.4 percent to $2,013.13 per ounce by 0701 GMT, after hitting its highest since March 2022 on Wednesday. US gold futures dipped 0.2 percent to $2,030.70.
The dollar index edged 0.1 percent higher, making bullion expensive for overseas buyers.
"This is a market due for some technical correction because the rally was very sharp," said Ajay Kedia, director at Kedia Commodities in Mumbai.
The economic data points this week were major components supporting gold prices, he added, while also noting some profit-booking ahead of the Good Friday holiday.
Bullion has gained about 2.3 percent so far this week, after a surprise oil output cut by OPEC+ and weak US economic data over the week added to fears of an economic slowdown and sent the yellow metal soaring above $2,000.
Wednesday's data showed the US services sector slowed more than expected in March. Separate data showed private sector job ads fell well short of expectations.
Investors now await Friday's non-farm payrolls report for March.
While gold is traditionally considered a hedge against inflation and economic uncertainties, higher interest rates dim non-yielding bullion's appeal.
Markets see a 59 percent chance of the Fed standing pat on interest rates in May, according to CME's FedWatch tool. Cleveland Federal Reserve Bank President Loretta Mester said it was too early to know if the Fed would need to raise interest rates at its May policy meeting.
"The gold trade is getting a bit overcrowded but the macro backdrop still strongly remains firmly in its favor," Edward Moya, a senior market analyst at OANDA, said in a note, adding that gold's immediate resistance is at the $2,050 level. Spot silver fell 0.6 percent to $24.82 per ounce, platinum gained 0.8 percent to $1,005.01, while palladium edged 0.1 percent lower to $1,427.74.
The dollar index edged 0.1 percent higher, making bullion expensive for overseas buyers.
"This is a market due for some technical correction because the rally was very sharp," said Ajay Kedia, director at Kedia Commodities in Mumbai.
The economic data points this week were major components supporting gold prices, he added, while also noting some profit-booking ahead of the Good Friday holiday.
Bullion has gained about 2.3 percent so far this week, after a surprise oil output cut by OPEC+ and weak US economic data over the week added to fears of an economic slowdown and sent the yellow metal soaring above $2,000.
Wednesday's data showed the US services sector slowed more than expected in March. Separate data showed private sector job ads fell well short of expectations.
Investors now await Friday's non-farm payrolls report for March.
While gold is traditionally considered a hedge against inflation and economic uncertainties, higher interest rates dim non-yielding bullion's appeal.
Markets see a 59 percent chance of the Fed standing pat on interest rates in May, according to CME's FedWatch tool. Cleveland Federal Reserve Bank President Loretta Mester said it was too early to know if the Fed would need to raise interest rates at its May policy meeting.
"The gold trade is getting a bit overcrowded but the macro backdrop still strongly remains firmly in its favor," Edward Moya, a senior market analyst at OANDA, said in a note, adding that gold's immediate resistance is at the $2,050 level. Spot silver fell 0.6 percent to $24.82 per ounce, platinum gained 0.8 percent to $1,005.01, while palladium edged 0.1 percent lower to $1,427.74.
AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Comments
Oh ya 60 days ago
Remember folks this is paper gold they are talking about and no real gold changes hands. For normal everyday folks it is real gold held outside the banking system that is important. You must rap your head around the fact that the price of anything goes up because the value of the dollar is actually going down. More worthless dollars to buy the same product you bought last month for less
