US Jobs Data Weighs Heavily on Gold Prices

Gold prices fell on Monday as stronger-than-expected US jobs data reinforced expectations that interest rates could rise further. The data showed US job growth accelerated sharply in August, with the unemployment rate remaining unchanged at 4.1 per cent.

This has kept the possibility of a rate increase this month on the table and put pressure on gold prices. Spot gold was down 0.6 per cent at $4,402.86 per ounce by 0420 GMT, after declining 1 per cent on Friday.

Investors are now focused on US Producer Price Index (PPI) data due on Thursday, followed by Consumer Price Index (CPI) figures on Friday. A strong inflation print would reinforce expectations of a Fed hike and weigh more heavily on gold.

Tim Waterer, Chief Market Analyst at KCM Trade, said the stronger jobs data had weighed on gold prices but had not completely cemented expectations of a September rate increase.