Gold Down as U.S. Dollar Strengthening over Interest Rate Hike Bets

By Zhang Mengying

Investing.com – Gold was down on Monday morning in Asia, as the U.S. dollar strengthened over interest rate hike bets after healthy U.S. employment data.

Gold futures edged down 0.10% to $1,740.50 by 12:01 AM ET (4:01 AM GMT). The dollar , which normally moves inversely to gold, climbed back towards its highest level in about 20 years hit on Friday.

“While gold prices remain below $1,753/oz it seems a move down to $1,720 is on the cards. Although there is some support around $1,730 ... given the bearish trend overall, any upside is likely to be a retracement, at best,” City Index senior market analyst Matt Simpson said.

U.S. jobs data released last week showed a healthy sign, which eased some recession fears, raising expectations of more monetary tightening from the U.S. Federal Reserve.

“Gold has had a large move lower, and there comes a point where the market needs to pause for breath. And that’s what we are seeing on gold right now,” Simpson said.

Benchmark U.S. 10-year Treasury yields steadied near the previous session’s over one-week high, denting demand for bullion.

Investors now await U.S. Consumer Price Index (CPI) , due this Wednesday, which is expected to get closer to 9%, a fresh four-decade high.

In other precious metals, silver edged up 0.11%. Platinum fell 0.88%, while palladium dived 3.65%.