Gold prices fell below $4,400 an ounce as strong U.S. jobs data increased the likelihood of a September Fed rate hike, while Brent crude held near $97 amid rising geopolitical tensions.
The U.S. Dollar Index remained broadly unchanged at 99.07 as the market digested the latest employment report. While the jobs data was strong, the index is currently balancing the impact of potential Fed rate hikes against upcoming inflation data releases.
The U.S. Dollar Index was reported at 99.07.
Gold prices dropped 0.8% to $4,396.29 an ounce on Monday as robust U.S. employment data bolstered expectations for a Federal Reserve rate hike. Markets are currently pricing in a 60% probability of an increase at the September meeting, pressuring non-yielding bullion. Investors are now shifting focus to upcoming inflation data and geopolitical tensions in the Strait of Hormuz.
Strong employment data suggests a robust economy, which increases the likelihood of the Federal Reserve raising interest rates. Higher rates make income-generating assets more attractive than non-yielding gold, reducing demand for the metal.