Gold Remains Near 2-Month Lows Ahead of US Jobs Data

Gold stayed near its 2-month low on Thursday, with market players taking a close look on the U.S. nonfarm payrolls data scheduled to be released on Friday.

Investors are awaiting the release of the US jobs data to gather fresh cues on the timing of a potential interest rate hike by the U.S. Central Bank.

“With Friday’s US payrolls data looming large, we are seeing ranges tighten (for gold) and skew to the downside as anticipation builds for a potential September interest rate hike” said Sam Laughlin, a precious metals trader with MKS PAMP Group.

Most analysts anticipate that the U.S. job data will reveal a jobs growth of 180,000 in August, followed by a 255,000 increase in the preceding month. 

A positive U.S. jobs data report would strengthen the expectations for a possible U.S. rate increase in September, following the hawkish signals from the Central Bank officials in the recent days. 

Spot gold moved 0.1% lower to $1,306.81 an ounce by 07:00 am GMT. On Wednesday, it hit its lowest since June 24 at $1,304.91 per ounce on Wednesday. 

U.S. Gold Futures declined 0.1% to trade at $1,310.10 an ounce. 

Gold for December delivery on the Comex division of the NYMEX slipped $1.10, or 0.08 percent, and was valued at $1,310.30 per ounce by 07:07 GMT.

On Wednesday, the price of the precious metal declined to as low as $1,306.90, its lowest price since June 24, after positive private sector U.S. employment data boosted speculations that the U.S. Central Bank is on its way to increase interest rates at its September meeting. 

The yellow metal is highly sensitive to the movement of the U.S. interest rates. An increase in the interest rates weakens the demand for the gold, while strengthening the dollar in which it is priced. 

Also, a stronger U.S. dollars lessens the appeal for the precious metal, and makes dollar-denominated assets such as gold more expensive to holders of other major currencies. 

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