NEW YORK: Gold prices dropped on Thursday, pressured by strength in the dollar and Treasury yields, while investors prepared for US jobs data that could influence the Federal Reserve’s monetary policy trajectory.
Spot gold fell 0.4% to $1,708.35 per ounce by 12:17 p.m. EDT (1617 GMT). US gold futures dipped 0.2% to $1,716.90.
The dollar index rose over 1%, making greenback-priced gold more expensive for other currency holders. Benchmark US 10-year Treasury yields also firmed.
“We’re essentially just holding as we have a big jobs report tomorrow and then some inflation data next week ... those would be two major data points to determine the next leg here for gold, looking forward to the next Fed meeting,” said Ryan McKay, commodity strategist at TD Securities.
The US Labor Department’s nonfarm payrolls data for September on Friday would follow a better-than-expected ADP National Employment report on Wednesday.
Another beat on jobs data ultimately would weigh on gold, McKay said, “as it would reinforce the need for the Fed to continue with their hawkish stance for a bit longer.” The Institute for Supply Management’s non-manufacturing PMI reading also came in slightly above expectations, suggesting underlying strength in the economy despite rising interest rates.
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