Gold slips as US jobless claims data cements bets on rate hike

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  • Dollar dips from 16-month highs as rally pauses
  • Weekly jobless claims in the United States close to pre-pandemic levels

Nov. 18 (Reuters) – Gold prices fell on Thursday as encouraging weekly US jobless claims data bolstered bets on an earlier-than-expected rate hike by the Federal Reserve following recent data high inflation in the United States.

Spot gold fell 0.3% to $ 1,860.62 an ounce at 10:30 a.m. ET (3:30 p.m. GMT), while US gold futures fell 0.4 % to $ 1,862.50. Despite the drop in prices, the bullion still held close to its highest level in five months, reached on Tuesday.

“One of the main reasons for this surge in gold was that the rates fell quite sharply. But then they came back, which limits the rise in gold,” said Daniel Pavilonis, senior market strategist. at RJO Futures.

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The number of Americans filing new unemployment benefits claims fell near pre-pandemic levels last week, data showed Thursday. Any sign of an economic recovery is reducing demand for the safe haven metal. Read more

“It just correlates with a higher probability that the Fed will actually have to raise rates,” Pavilonis said.

U.S. Treasury yields held near recent three-week highs as the U.S. dollar paused to catch its breath, returning from a 16-month high. A weaker dollar makes gold more attractive to buyers holding other currencies.

Bullion, seen as a hedge against inflation, benefited from soaring consumer prices in the United States and Europe. But it also bolstered bets on early interest rate hikes, which would increase the opportunity cost of holding unproductive gold. Read more

“At the moment, it is difficult for gold to find a direction due to the uncertainty surrounding the performance of the dollar and the likely response of the Fed and other central banks to inflation,” said Ricardo Evangelista, Senior Analyst at ActivTrades.

Elsewhere, platinum slipped 1.4% to $ 1,042.88 an ounce, while palladium was down 1.4% to $ 2,157.17

Silver fell 1.1% to $ 24.78 an ounce.

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Reporting by Ashitha Shivaprasad, Swati Verma and Arundhati Sarkar in Bangalore; Edited by Ramakrishnan M.

Our Standards: Thomson Reuters Trust Principles.


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