Gold prices fall as dollar rises, yields boost on strong US jobs data

Gold prices fell on Monday as dollar and Treasury yields stabilized after a strong US jobs report raised expectations for a sharp interest rate hike, although the Ukraine crisis and talks about more sanctions against Russia supported safe-haven demand.

A strong dollar makes gold less attractive to other currency holders, while higher returns increase the opportunity cost of holding unpaid bullion.

And spot gold fell 0.3 percent to $ 1917.55 an ounce by 0434 GMT. US gold futures fell 0.2% to $1,920.30.

“While the conflict in Eastern Europe may provide a modest tailwind for gold prices on dips, it is now very clear that key pricing inputs for gold have been impacted by the impact of higher US yields and a stronger US dollar,” an OANDA official said. Analyst Jeffrey Haley.

The dollar had a strong start to the week while Treasury yields were also higher, with the monthly US jobs report indicating a strong job market and likely to keep the Fed on track to maintain its hawkish stance on policy. [USD/] [US/]

US jobs data showed the unemployment rate fell to a new two-year low of 3.6% and wages reaccelerated, causing the Federal Reserve to raise interest rates by 50 basis points in May.

Investors are looking forward to any discussion of a 50 basis point rate hike when the Federal Reserve releases the minutes of its March meeting on Wednesday.

Meanwhile, the German Defense Minister said, on Sunday, that the European Union should discuss banning Russian gas imports, after Ukrainian and European officials accused Russian forces of committing atrocities.

The spot price of gold may drop to $1898, as it broke the support at $1,924 an ounce, according to Reuters technical analyst Wang Tao. [TECH/C]

Spot silver prices fell 0.2% to $24.57 an ounce, platinum fell 0.1% to $984.49, while palladium rose 1.3% to $2,306.19.

(Reporting by Asha Cestla in Bengaluru; Editing by Sherry Jacob Phillips)

(The title and image for this report may have been reformulated only by the Business Standard staff; the rest of the content is automatically generated from a shared feed.)

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