Gold Drops as Strong Jobs Data Reinforces Rate Hike Bets

Gold prices declined on Monday as strong US jobs data reinforced expectations for higher interest rates. The robust employment numbers, which showed US job growth accelerated sharply in August, kept a rate increase this month on the table.

The data also suggested an improvement in the labour market after recent struggles. As a result, traders are pricing in a 58.4% chance of a rate hike at the Fed's September 15-16 meeting.

While gold is often seen as an inflation hedge, higher interest rates tend to weigh on its appeal. The real missing piece of the puzzle arrives this week with US CPI data due on Friday.