Gold slipped on Tuesday to its lowest since mid-April as the dollar strengthened in the run-up to this week's U.S. jobs report, which is expected to come in strong and could cement the Federal Reserve's recent hawkish stance.
Spot gold fell 0.9% to $1,762.96 per ounce by 12:55 pm EDT (1655 GMT) after touching $1,749.20, its lowest since April 15. U.S. gold futures shed 0.9% to $1,764.10.
Bob Haberkorn, senior market strategist at RJO Futures, said that, in addition to a stronger dollar, some investors are likely anticipating better-than-expected jobs data.
"The calls for interest rates to trend higher are going to be much louder from the Fed if we do get a better-than-expected jobs number," weighing on gold, Haberkorn said.
The U.S. Labor Department's nonfarm payrolls data due on Friday is expected to show a gain of 690,000 jobs this month, compared with 559,000 in May, according to a Reuters poll.
The data is due after comments from Federal Reserve Bank of Richmond President Thomas Barkin, who suggested the Fed had made "substantial further progress" in its inflation goal in order to begin tapering asset purchases.
Growing signs that point to a sooner-than-expected U.S. interest rate hike and the preceding tapering should heap more downward pressure on gold, potentially bringing it down to $1,730, Han Tan, chief market analyst at Exinity Group said.
The dollar index rose 0.2%, making gold more expensive for holders of other currencies.
But, a broader data disappointment trend could eventually support gold as the market reflects on continued economic risks at a time when markets have priced a first rate hike from the Fed in December 2022, TD Securities said in a note.
In other metals, silver fell 1.1% to $25.82 per ounce, platinum dropped 1.7% to $1,071.42, and palladium edged 0.1% down at $2,682.89.
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June 29, 2021 at 01:12PM
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Gold swoons to 11-week low on dollar, hawkish Fed double whammy - CNBC
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