Gold Slides as Strong US Jobs Data Hikes Rate Hike Expectations
Gold prices fell on Monday as strong US jobs data reinforced expectations for higher interest rates. The US labor market showed job growth accelerated sharply in August, while the unemployment rate held steady at 4.1%, suggesting an improvement after recent struggles.
The Federal Reserve's policy path remains uncertain, with investors awaiting key US inflation reports due later this week. On Thursday, the US will release producer price index (PPI) data, followed by consumer price index (CPI) data on Friday.
According to Tim Waterer, chief market analyst at KCM Trade, a strong inflation print would reinforce expectations of a Fed hike, lift yields further, and weigh more heavily on gold. Traders are pricing in a 58.4% chance of a rate hike at the Fed's September 15-16 meeting.