Bullion braces for fresh swings as US jobs data, Iran tensions take centre stage: Analysts

After a week of sharp gold price declines, commodity markets brace for further volatility as key economic data and geopolitical tensions loom, experts say. Bullion traders anticipate US jobs figures, manufacturing and services PMI data, Eurozone and German inflation reports, and the US non-farm payroll report to heavily influence the market.

Jateen Trivedi, VP Research Analyst at LKP Securities, predicts the week will be volatile as traders try to incorporate the possibility of a Federal Reserve policy change in September. Gold futures on the Multi Commodity Exchange (MCX) dropped Rs 6,157, or 3.8%, last week, while silver futures for September contracts slipped Rs 9,893, or 4%, to Rs 2.36 lakh per kilogram.

Silver outperformed gold in August, gaining around 21% compared to gold's 15.7%, according to Gaurav Garg, Head of Research at Lemonn Markets Desk. Market participants will closely watch US labor-market indicators, including non-farm payrolls, unemployment data, and ADP non-farm employment change, as they could sway the Federal Reserve's decisions ahead of its September meeting.

Geopolitical factors, such as the US-Iran conflict and developments around the Strait of Hormuz, will also add to the uncertainty. Despite the recent decline, Trivedi notes that silver's performance in August suggests it may stabilize after the recent correction or enter another phase of profit booking.