Gold was little changed on Monday morning while the prospect of a September interest-rate rise in the US caps buying interest.
The spot gold price of $1,173.20/1,174.00 per ounce was up $1.80 on Friday’s close. The metal has traded in an intraday range of around $8 so far.
Similarly, silver was last at $16.11/16.16 per ounce, up four cents. Platinum has rebounded slightly from the March low hit on Friday – it was last at $1,097/1,102, up $5, while palladium was $2 higher at $749/755.
Sentiment in precious metals has been soured by Friday’s strong US jobs report, which has put monetary policy normalisation from September back on the table. The US created 280,000 new jobs in May, significantly above estimates of 222,000 and the highest increase in several months.
US indicators have increased in importance while observers seek signs of an economic rebound in the second quarter – for the gold market, higher US interest rates would see many investors switching to more yield-bearing assets.
The Federal Reserve has identified US jobs data as one of the key factors in its decision when to raise interest rates from near zero, where they have been since 2008.
Gold dropped to a low of $1,162.60 on the news before returning to its prevailing range this year of $1,175-1,225, suggesting that the move was predominantly priced in.
“The yellow metal has retained its focus on the strength of the US macro data and timing of the first rate hike,” Barclays said in a note reaffirming that it believes a September rise is on the cards. “Until then, gold is likely to face increasing downward pressure, particularly given the seasonally slow period for demand.”
The dollar has edged back from Friday’s highs following some punchy eurozone data this morning – it was last at 1.1156 against the euro.
German industrial production at 0.9 percent surpassed expectations at 0.6 percent, as did the country’s trade balance at 22.3 billion euros against consensus at 18.1 billion euros.
The Chinese trade balance at $59.5 billion beat the forecast $44.9 billion and was higher than the previous $34.1 billion while Japanese final GDP at 1.0 percent was stronger than the predicted 0.7 percent. There are no numbers of note from the US today.
Elsewhere, despite continuing negotiations, there was no resolution to the Greek debt crisis last week, raising concerns of a possible Greek exit from the bloc.
In an address to the Greek parliament last Friday, Greek Prime Minister Alexi Tsipras called creditor plans “unrealistic” and urged them to withdraw their proposals.
European Commission president Jean-Claude Juncker has called for Tsipras to act “swiftly” on alternative proposals so that negotiations can continue this week after insinuating that the country has failed to deliver on the reforms that it had “promised”.
“[But] despite the Greek saga entering a crucial phase, gold has failed to garner safe-haven interest,” Barclays added.
(Editing by Mark Shaw)
The post Gold price capped, September US rate rise back on the table appeared first on The Bullion Desk.
No comments:
Post a Comment