Gold firms on softer dollar, investors await US jobs data

Gold prices were underpinned by a subdued dollar on Tuesday, with investors looking ahead to US non-farm payrolls data, which could be key to the Federal Reserve's tapering decision.

FUNDAMENTALS

• Spot gold rose 0.1% to $1,812.27 per ounce by 0116 GMT.

• US gold futures were up 0.2% at $1,816.00.

  • The dollar hovered near two-week lows against a basket of currencies, steadying from falls after Fed chief Jerome Powell gave no signal regarding the central bank's tapering timeline except that it could be "this year."

Gold prices scale near 4-week high on Powell's dovish tone

• Gold is considered a hedge against inflation and currency debasement in the wake of massive stimulus measures.

  • Cleveland Fed President Loretta Mester said the US economy is recovering strongly but she is not yet convinced that recent inflation readings will be enough to satisfy the price stability goal the central bank revamped a year ago.

• The US non-farm payrolls report for August is due on Friday. The market is expecting an increase of 728,000 jobs, unemployment to fall to 5.2% from 5.4% and average hourly earnings to rise 0.4% month-on-month.

• China's factory activity expanded at a slower pace in August as coronavirus-related restrictions and high raw material prices pressure manufacturers in the world's second largest economy.

• Roughly 28% of Brazilian gold exports in 2019 and 2020 likely came from illegal mines, a report by public prosecutors and the Federal University of Minas Gerais found, pointing to widespread forging of documents and lack of effective law enforcement.

• Silver fell 0.1% to $24.03 per ounce, while platinum eased 0.3% to $1,003.89.

• Palladium dropped 0.7% to $2,476.22, having risen 3.1% in the previous session. Reuters