Gold Falls as US Dollar Strengthens Ahead of Key Payrolls Data
Gold prices fell on Friday and are set for their second straight weekly decline. The metal's value dropped 0.6% to $4,154.78 per ounce by 0205 GMT, with a more than 3% loss for the week so far. US gold futures lost 0.4% to $4,184.00.
The rising US dollar and increased Treasury yields have put pressure on gold prices. The greenback's strength makes it more expensive for holders of other currencies to buy gold. Yields on 10- and 30-year Treasuries hit their highest levels since 2002 on Thursday.
Market participants are watching US interest rate expectations and geopolitical developments in the Middle East, said Kyle Rodda, senior financial market analyst at Capital.com. The upcoming September US nonfarm payroll data will be critical for rate expectations.
If the report comes in hot, it may increase the chances of rate hikes from the Federal Reserve. This could weigh even further on gold prices, as higher borrowing costs typically diminish its attractiveness.