LONDON: Gold fell as much as 1.2 percent on Friday, as the dollar rose after US data showed employment increased more than expected in July, raising the probability of an interest rate hike from the US Federal Reserve this year.
Nonfarm payrolls increased by 255,000 jobs last month as hiring rose broadly after an upwardly revised 292,000 surge in June, the Labor Department said.
Spot gold, steadier initially, fell to one-week low of $1,344.85 an ounce and was down 1.1 percent at $1,345.51 by 1326 GMT.
Spot platinum was down 1.1 percent at $1,147.95, after touching its highest since April 2015 at $1,177.40 on Tuesday, while spot silver fell 1.7 percent to $19.89 an ounce.
Deutsche Bank analyst Michael Hsueh said that investors will now monitor movements on 10-year real yields, relative to which gold looks overpriced.
Deutsche Bank expects a single US rate hike this year.
The benchmark 10-year US Treasury yield hit session highs of 1.549 percent after the data.
Gold is highly sensitive to rising US interest rates, as the opportunity cost of holding the non-yielding asset increases while boosting the dollar, in which it is priced.
The dollar rose 0.5 percent against a basket of six major currencies and global stock markets gained after the data.
Economists polled by Reuters had forecast payrolls increasing 180,000 in July and the unemployment rate dipping one-tenth of a percentage point to 4.8 percent.
Gold had benefited after the Bank of England cut interest rates to next to nothing on Thursday and unleashed billions of pounds of stimulus to cushion the economic shock from Britain’s vote to leave the European Union.
Nonfarm payrolls increased by 255,000 jobs last month as hiring rose broadly after an upwardly revised 292,000 surge in June, the Labor Department said.
Spot gold, steadier initially, fell to one-week low of $1,344.85 an ounce and was down 1.1 percent at $1,345.51 by 1326 GMT.
Spot platinum was down 1.1 percent at $1,147.95, after touching its highest since April 2015 at $1,177.40 on Tuesday, while spot silver fell 1.7 percent to $19.89 an ounce.
Deutsche Bank analyst Michael Hsueh said that investors will now monitor movements on 10-year real yields, relative to which gold looks overpriced.
Deutsche Bank expects a single US rate hike this year.
The benchmark 10-year US Treasury yield hit session highs of 1.549 percent after the data.
Gold is highly sensitive to rising US interest rates, as the opportunity cost of holding the non-yielding asset increases while boosting the dollar, in which it is priced.
The dollar rose 0.5 percent against a basket of six major currencies and global stock markets gained after the data.
Economists polled by Reuters had forecast payrolls increasing 180,000 in July and the unemployment rate dipping one-tenth of a percentage point to 4.8 percent.
Gold had benefited after the Bank of England cut interest rates to next to nothing on Thursday and unleashed billions of pounds of stimulus to cushion the economic shock from Britain’s vote to leave the European Union.
