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Gold Up Even as U.S. Jobs Report Signals More Rate Hikes

Commodities Jun 05, 2022 11:09PM ET
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© Reuters

By David Ho

Investing.com – Gold was up on Monday morning in Asia even as the U.S. jobs report signaled more interest rate increases this year that could weigh on non-yielding bullion.

Gold futures were up 0.32% to $1856.20 by 10:26 PM ET (2:26 AM GMT). It has traded between $1,828 and $1,864 for the past week, remaining at an average of $1,850 overall.

The Federal Reserve is on track for half a point interest rate increases in June, July, and perhaps even beyond since fresh job market data showed no sign of the U.S. economy falling under high inflation and rising borrowing costs.

On Friday, gold slipped after data showed U.S. employers hired more workers than expected in May and maintained a strong pace of wage increases.

Meanwhile, investors upped their bets on European Central Bank interest rate rises this year and priced in a bigger, 50 basis-point hike at one of the bank's policy meetings by October.

Higher rates raise the opportunity cost of holding gold, as it yields no interest.

On Friday, South African precious metals miner Sibanye Stillwater (NYSE:SBSW) stated that trade unions leading a strike at its gold operations had a mandate from their members to accept a three-year wage deal.

In addition, Ghana's gold production fell 30% last year to its lowest in more than a decade, knocking the country off its spot as Africa's top producer, according to the president of the mines chamber.

The previous week, gold discounts widened in India as demand faltered due to a rise in prices and a winding up of the wedding season. Consumers in top consumer China also remained cautious of purchasing bullion amid a gradual relaxing of coronavirus restrictions.

In other metals, platinum firmed 0.2% to $1,015.99 and palladium climbed 0.9% to $1,993.52. Silver also rose 0.1% to $21.92 per ounce.

 
Gold Up Even as U.S. Jobs Report Signals More Rate Hikes
 

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Comments (2)
Ayaz Mansuri
Ayaz Mansuri Jun 07, 2022 10:52AM ET
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dont move from 1856
MICHAEL POLAK jr
MICHAEL POLAK jr Jun 06, 2022 2:32AM ET
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wow the gold is lower than silver
Semenya Masenya
Semenya Masenya Jun 06, 2022 2:32AM ET
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does this mean as a newbie in trading,I should buy gold
 
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