Gold's 9% Pullback: Can Jobs Data Revive the Market?

The gold market has been moving in unexpected ways over the past week, despite rising tensions between the US and Iran.

Rather than benefiting from safe-haven demand, gold prices have fallen by almost 9% since reaching a three-month high near $4,697.

This decline can be attributed to several factors, including higher Treasury yields and a stronger dollar. The 10-year yield has climbed to 4.818%, its highest level since November 2023, which increases the opportunity cost of holding gold as it does not generate interest income.

The upcoming August non-farm payrolls report is expected to influence expectations for Federal Reserve policy and potentially change rate hike expectations, currently around 66% to 70%.