Gold Prices Slide as Strong US Jobs Report Boosts Rate Hike Bets

Gold prices eased on Monday after a strong US jobs report increased expectations of a Federal Reserve interest rate hike this month. According to the CME FedWatch Tool, traders now see a 58% chance of an interest rate hike at the central bank's policy meeting next week, up from a 50% probability before the jobs data was released.

The US producer price index data is due on Thursday and the consumer price index data is scheduled for the next day. Despite inflation worries remaining high, gold prices tend to diminish in value when interest rates rise as higher yields make non-yielding bullion less appealing to investors.

Ole Hansen, head of commodity strategy at Saxo Bank, noted that gold has moved in the opposite direction to energy prices, extending its decline after Friday's strong US jobs report lifted bond yields and reinforced expectations of a Fed rate hike on 16 September. Gold twice found buying interest below $4,400, but resistance continues to emerge above $4,500.