Gold holds at $4,106 as the US Dollar slips to 101.83, with market attention shifting to this week's inflation reports and Fed commentary to determine the path for interest rates.
The DXY slipped from Friday's high of 102.36 to around 101.83 as investors digest the strong October payrolls (165K vs 65K forecast). The resilient labour market and Fed officials' hawkish projections support the dollar, but this week's CPI and PPI will determine whether rate-hike expectations hold.
Gold trades around $4,106, up 1% on the day, as the dollar gives back gains, but the metal fails to break decisively above $4,100. Traders price an 80% chance of a December Fed rate hike, and the hawkish outlook raises the opportunity cost of holding non-yielding gold. Tuesday's CPI and Friday's PPI will decide the direction.
Gold prices trade at $4,106, up 1% today, as the US Dollar retreats from Friday's highs of 102.36. Investors are now focused on upcoming US CPI and PPI data to gauge the likelihood of a December Federal Reserve rate hike, which is currently priced at an 80% probability.
The dollar is giving back some of the gains it made after Friday's strong US jobs report, which showed Nonfarm Payrolls at 165K versus the 65K forecast, with the index falling from 102.36 to around 101.83.
It depends on this week's US inflation data. CPI is due Tuesday and PPI on Friday, and traders currently price an 80% chance of a December Fed rate hike, which would support the dollar if confirmed.
The US Dollar gave back some of the gains sparked by Friday's strong US jobs report, which supports dollar-priced gold. The metal traded around $4,106, up 1% on the day.
Traders price an 80% chance of a December Fed rate hike, and higher rates are a headwind for the non-yielding metal. Stronger-than-expected CPI or PPI this week would strengthen that headwind, and a break below $4,068 could expose the $4,000 psychological level.