Gold falls below $4,400 as strong US jobs data raise the prospects for Fed rate hike
Gold price (XAU/USD) tumbles to near $4,395 during the early European session on Monday. The precious metal extends the decline as robust US employment data boost US Federal Reserve (Fed) rate hike bets.
Gold prices slipped below $4,400 on Monday as strong US jobs data increased the likelihood of the Federal Reserve raising interest rates. The US Nonfarm Payrolls (NFP) rose by 162K in August, surpassing expectations and heightening the chances of a September rate hike. This positive economic news has made the non-yielding nature of gold less attractive, leading to a decline in its value.
Analysts suggest that traders will now closely monitor US Producer Price Index (PPI) and Consumer Price Index (CPI) inflation reports for further indications of the Fed's policy direction. Tensions in the Middle East have also contributed to gold's downward trend, with Iran targeting several oil tankers and US-linked ships. Commerzbank noted that recent doubts about a September rate hike from Fed Governor Christopher Waller are contributing to the metal's rebound.
Currently trading below the 100-day Simple Moving Average, gold's near-term trend remains mildly bullish. Support levels are near $4,405, with a deeper slide potentially exposing lower Bollinger band support around $4,260.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
Also reported by 2 other outlets
- Gold holds decline as traders weigh prospects for US Fed rate hike businesstimes.com.sg
- Gold Holds Decline as Traders Weigh Prospects for Fed Rate Hike bloomberg.com
