Gold Treads Water as Rate Hike Bets Surge Amid Strong US Jobs Data

Gold prices remained steady around $4,400 an ounce on Monday as a strong US jobs report fueled expectations of a Federal Reserve interest rate hike in September. The employment data showed that US employers added 162,000 jobs in August, beating expectations and keeping the unemployment rate at 4.1%. This has led to a rise in the probability of a September rate hike, with markets now pricing around a 60% chance.

The stronger labor market has put pressure on gold as higher interest rates can weigh on the precious metal since it does not generate interest or dividends. A rising US dollar also adds to the challenge for gold as bullion is priced in dollars and becomes more expensive for buyers using other currencies. The dollar gained after the jobs report, further adding pressure on gold.

Rising oil prices are another concern for both gold and the Federal Reserve, as they can feed directly into inflation. Brent crude climbed toward $97 a barrel on Monday due to tensions around the Strait of Hormuz, which has raised concerns about disruptions to global energy supplies. The upcoming US inflation data will be crucial in determining whether the recent shift toward a more hawkish Fed outlook will continue.