Gold snaps 3-day winning streak as US Dollar posts firm returns

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  • Gold drops after posting gains in past three sessions
  • BoE to announce policy decision at 12:00 GMT, ECB at 12:45 GMT
  • Markets await U.S. nonfarm payrolls data on Friday

Feb 3 (Reuters) – Gold prices fell ahead of key central bank meetings on Thursday as U.S. dollar and Treasury yields strengthened a day after dismal private payroll data pushed up bullion prices at one-week highs.

Spot gold slipped 0.2% to $1,803.16 an ounce, as of 1023 GMT, after hitting its highest level since January 27 at $1,810.86 in the previous session. . US gold futures fell 0.4% to $1,803.70.

Benchmark 10-year U.S. Treasury yields rose slightly, while the dollar index strengthened against its rivals, making bullion expensive for buyers holding other currencies.

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Investors are now awaiting Friday’s closely watched non-farm payrolls figures after Wednesday’s ADP data showed that the US private payroll unexpectedly fell last month. Read more

“Tomorrow’s payrolls data would be important to get confirmation of a weaker labor market, which is a key driver for the Fed to slow its rate hike plans,” said Soni Kumari, commodity strategist. premieres at ANZ.

“We see inflation numbers and geopolitical tensions guiding gold prices in the near term.”

US Federal Reserve officials have announced they will begin raising interest rates next month to combat high inflation.

Markets also expect the Bank of England to raise interest rates again later today, while the European Central Bank is expected to keep policy unchanged but acknowledge the surge in inflation. Read more

Gold is considered an inflation hedge, but rising interest rates would make non-performing bullion less attractive.

“The magnetic pull towards the $1,800 level has persisted for almost a year now, and gold is struggling to break out of its range,” said independent analyst Ross Norman.

Gold looks well supported by good physical buying but is unable to sustain bullish momentum, Norman added.

Spot Gold versus US Dollar

In other metals, silver was down 0.9% at $22.42 an ounce, platinum was down 0.6% at $1,026.51 and palladium was up 0.1% at $2,372.15.

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Reporting by Seher Dareen and Swati Verma in Bengaluru; Editing by Vinay Dwivedi

Our standards: The Thomson Reuters Trust Principles.

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