The spot gold price continued to consolidate during Asian trading hours on Tuesday after last Friday’s bounce from a weaker-than-expected US payrolls report.
Spot gold was last at $1,327.20-1,327.60 per ounce, up just $1.15 from Monday’s close. Trading ranged at $1,325-1,328.45 so far.
The spot gold price rose to a one-week high of $1,330.05 last Friday after US August jobs report showed that only 151,000 Americans joined the labour market, missing expectations of a 186,000 increase.
“The latest US macro data suggests the Fed is unlikely to raise rates in September; waiting until December would give FOMC members sufficient confidence in the US economic outlook and give the Fed time to prepare the market for a rate increase and avoid unnecessary volatility,” James Moore, a research analyst at FastMarkets, said.
The fact that dips in the gold price have been supported continues to reflect fund/momentum interest in the low/negative interest-rate environment, Moore added.
“But prices are meeting overhead resistance and the absence of ETF investment demand into recent weakness suggests there are risks of further disinvestment, particularly if Fed rate-rise expectations strengthen again. We see a breach of $1,300 as likely to generate deeper downside pressure,” he added.
Market participants currently see a 21 percent change of a September rate hike, while the majority expects a lift-off in December, according to the CME FedWatch Tool.
In currencies, the US dollar index was last at 95.74 on Tuesday, down 0.05 percent from the previous day’s close.
In equities, the Shanghai Composite fell 0.05 percent to 3,070.57 on Tuesday.
In other commodities, the Brent crude oil spot price increased 0.6 percent to $47.67 per barrel, and Texas light sweet crude spot price gained 0.47 percent to $45.27 recently on Tuesday.
In data, the USM non-manufacturing PMI, IBD/TIPP economic optimism, and labour market conditions index from the US are due later today.
In other precious metals, silver was last at $19.53/19.54, up $0.045. Platinum was recently at $1,074/1,081, up $7.50, and palladium gained $10 to $681/689 recently on Tuesday.
On the Shanghai Futures Exchange, gold for December delivery was last unchanged at 286.60 yuan per gram, and the December silver was flat at 4,332 yuan per kilogram.
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Source: Bullion Desk News
