Gold prices rise as the dollar falls, and US jobs data awaits

  • 07 October, 2021
  • 2:56 pm EEST

Gold prices rose, during trading today, Thursday, in light of the anticipation of the release of US jobs data, and the decline in the dollar index.

Gold prices rose marginally, at the close of trading on Wednesday, with the decline in US Treasury yields.


Gold Prices Today

Gold futures prices, for December delivery, increased 0.25%, to $1,766.20 an ounce, by 10:00 AM GMT (1:00 PM GMT).

While gold prices in spot transactions increased by 0.06%, recording $1,763.83 an ounce.


Metal Prices

Silver futures prices for December delivery rose 1.06%, to $22.77 an ounce.

Platinum spot prices rose by 0.09%, to $990.36 an ounce.

Update – Gold prices rise marginally as US bond yields fall
Meanwhile, the dollar index, which measures the performance of the US currency against a basket of 6 other major currencies, decreased by 0.08%, at 94.1940 points.


American Jobs

SBI Asset Management explained that central banks are facing a turbulent situation, while inflation continues to rise to historical levels, noting that these rises support gold, but they are not good in light of the banks’ tendency to shift interest rates, according to Reuters.

Markets are awaiting the release of US non-farm payrolls data, tomorrow, Friday, amid expectations of an improvement in the labor market.

Vincent Tay, sales manager at Silver Bullion in Singapore, indicated that the precious metal prices need to cross the resistance levels, before confirming if the yellow metal is about to end the short-term downtrend.

Analysts said that the risk motive should be more influential to limit the upside for safe-haven gold, according to Fox Street.

They added that the Fed will begin to reduce its bond purchases by the end of the year, in light of the anticipation of a rate hike next year.


Non-Farm Jobs

The prices of the precious metal are affected by the US jobs data, and the non-farm payrolls for the month of September came in higher than expected, at 568,000 jobs, compared to expectations of 425,000 jobs.

Gold prices are also affected by the strength of the foreign currency, as official data showed, today, Thursday, that China’s foreign exchange reserves fell by nearly 1% in September from the previous month, reaching their lowest level since April, with the dollar rising against A basket of other major currencies.


US Currency

The dollar index rose by 1.7% in September, causing the value of assets in other major currencies to decline, influenced by the dollar.

Update – Gold prices fall to the lowest level in 6 months, as the dollar rises
This comes as China held 62.64 million ounces of gold at the end of September, unchanged from the previous month.

And the value of gold reserves fell to 109.18 billion dollars, from 113.69 billion dollars at the end of August, with the decline in gold prices.


Bond yields

Gold prices rose, in limited trading yesterday, Wednesday, against the backdrop of a decline in US Treasury bond yields, despite the strength of the US currency.

In turn, an expert at RG Futures, Bob Haberkorn, explained that gold is declining compared to other safety assets, amid the possibility of gold prices moving affected by the US non-farm payroll data.

Although stable above 1.5%, the yield on US 10-year Treasury bonds fell, after reaching its highest level in more than three months.


Energy Prices

Analysts expected that higher energy prices would stimulate inflation, raise interest rates, and raise the US currency, which would affect gold prices.

The head of commodity markets strategy at the International Bank of China, Xiao Fu, noted that even if the non-farm payrolls data were released in line with expectations, it could put pressure on gold prices.

Analysts pointed out that lower stimulus and higher interest rates, may lead to the weak attractiveness of gold prices.


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