Gold hovers near lows on US rate hike worries

Gold hovers near lows on US rate hike worries
A salesman holds gold to sell to a customer at a shop in Bangkok.

london - Bullion failed to gain support from a weaker dollar

Published: Mon 7 Aug 2017, 3:52 PM

Last updated: Mon 7 Aug 2017, 5:54 PM

Gold prices were little changed on Monday, failing to gain support from a weaker dollar as investors digested sharp losses in the previous session and worried about further US rate hikes.

Spot gold was down 0.1 per cent at $1,256.89 per ounce at 0951 GMT, having on Friday touched its lowest in just under two weeks at $1,254 an ounce and registering its first weekly decline in four.

US gold futures for December delivery fell 0.2 per cent to $1,262.50 per ounce.

The dollar edged lower on Monday following sharp gains the previous session, as investors focused on inflation data due this week that could determine the currency's longer-term trajectory.

Usually a weaker dollar supports commodities such as gold that are priced in the greenback, lowering the cost for buyers outside the United States.

Many investors, however, seemed wary of the upcoming data following unexpectedly strong jobs numbers on Friday, traders said.

"Investors were quick to liquidate some long positions, with market pricing of another rate hike by the Fed rising slightly as a consequence," said ANZ Research in a note.

Gold has largely been trapped in a broad range between $1,200 and $1,300 this year.

Also eroding support for gold on Monday was a rise by world equities to record highs. - Reuters

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