Gold Price Plummets After Strong US Jobs Data Fuels Rate Hike Bets
The price of gold took a hit after strong US jobs data indicated that the Federal Reserve could raise interest rates as soon as this month.
South East Asia (Reuters): Gold fell into the weekend and is on track for a weekly loss after robust US payrolls boosted expectations for an imminent rate hike, making non-yielding bullion less appealing. Spot gold dropped 1.2% to $4,419.09 per ounce by 01:49 p.m. EDT (1749 GMT), putting it in the red for the week.
The US job growth accelerated sharply in August while the unemployment rate held steady at 4.1%, keeping an interest rate hike from the Federal Reserve this month on the table, according to independent analyst Tai Wong. 'Gold stumbles badly as a huge headline print and overall strong report makes a September rate hike much more likely unless we get a weak CPI report,' he said.
The focus now shifts to next week's US consumer and producer price inflation data, which could provide further clues on the Federal Reserve's policy path. Analysts are keeping an eye on this data as it may yet trigger bigger moves for the precious metal, according to Bybit's chief market analyst Han Tan.