The global price of gold rose during these moments of trading on Wednesday, supported by a decline in Treasury bond yields, but it remained stuck in a narrow range as investors waited for more US data to gauge the Federal Reserve’s next move on monetary policy.
Yields on 10-year Treasury notes remained near their lowest in nearly three weeks hit on Tuesday, making bullion more attractive to investors.
“The key data release is the ISM non-manufacturing PMI report,” said Matt Simpson, senior analyst at City Index. “The ideal scenario for gold bulls is to see the index just below 50, as this is consistent with the soft landing scenario that the Fed wants to achieve.”
The index data is due at 17:00 Saudi time. Markets are also awaiting the ADP employment report due at 15:15 Saudi time on Wednesday, along with the non-farm payrolls data on Friday, for further clues on the health of the US economy and whether it will prevent the Federal Reserve from cutting interest rates in September. Higher interest rates increase the opportunity cost of holding non-yielding assets.
Jim Wyckoff, chief analyst at Kitco Metals, said weak jobs data could lead to a short-term rally in gold, while a strong labor market would weigh on the yellow metal as it could mean the Federal Reserve will continue to tighten monetary policy, according to Reuters.
Gold at settlement yesterday
Gold futures prices turned lower during trading on Tuesday, as investors awaited the US jobs report on Friday for more insight into the future path of interest rates.
At settlement, gold futures for August delivery fell 0.9%, or $21.9, to $2,347.4 per ounce, after the yellow metal rose to $2,373.10.
Gold and dollar now
Spot gold is now up 0.22% at $2,352 an ounce.
While spot gold contracts rose by about 0.25% to $2,333 per ounce.
On the other hand, the dollar index rose by 0.16% to 104.215 points.
Other minerals
Spot silver rose 0.7% to $29.69 an ounce, platinum rose 0.6% to $992.85 and palladium gained 0.9% to $923.83.
