Gold gains despite positive jobs report opens up prospect of interest rate hikes in the US

Gold gains despite positive jobs report opens up prospect of interest rate hikes in the US

 

Gold rose on Monday morning in Asia even as the US jobs report signaled even more rate hikes this year, which could weigh on gold.


Gold futures were up 0.32% to $1856.20 by 10:26 PM ET (2:26 AM GMT). It has been trading between $1,828 and $1,864 over the past week, staying at an average of $1,850 overall.


The Federal Reserve is slated for half-point rate hikes in June, July and possibly even beyond as fresh jobs market data shows no signs of slowing the economy. The United States is experiencing high inflation and rising borrowing costs.



Gold slipped on Friday after data showed US employers hired more workers than expected in May and maintained strong wage growth.



Meanwhile, investors have bet on a European Central Bank rate hike this year and priced in a larger, 50-basis-point rally at one of the bank's policy meetings. stock in October.

Higher interest rates increase the opportunity cost of holding gold, since it yields no yield.



On Friday, South African precious metals miner Sibanye Stillwater (NYSE: SBSW) announced that the unions leading a strike at their gold trading facilities had accepted a pay deal three years.


Additionally, Ghana's gold production fell 30% last year, to its lowest level in more than a decade, knocking the country out of its position as Africa's top producer.



Last week, gold sales extended in India as demand fell due to rising prices and towards the end of the wedding season. Consumers in top consuming nation China also remain cautious buying bullion amid the gradual easing of coronavirus restrictions.


In other metals, platinum rose 0.2% to $1,015.99 and palladium gained 0.9% to $1,993.52. silver also rose 0.1% to $21.92 an ounce.

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