Singapore - Gold declined before a US government payrolls report on Friday which may offer clues on whether the economy is strong enough for an interest rate rise after private jobs data showed an increase in hiring.
Bullion for immediate delivery fell 0.1 percent to $1 132.97 an ounce at 2:11 pm in Singapore, according to Bloomberg generic pricing. The metal lost 0.6 percent on Wednesday, the first decrease in four days.
US firms added more jobs in August than a month earlier, the ADP Research Institute said on Wednesday. Traders are focused on the nonfarm payrolls report for signals on the strength of the economy amid a global equity rout after China surprised markets by devaluing the yuan last month. The Federal Reserve scheduled its next rate decision on September 17.
“If the jobs data is very strong for the U.S. economy, it’s more likely that the Fed is going to decide to raise interest rates,” Bob Takai, CEO and president of Sumitomo Global Research, said by phone from Tokyo. The Fed will also have to consider what’s happening in China and on global financial markets, Takai said. “It’s 50-50 in my view.”
Signs of resilient US growth have supported speculation that Fed policy makers will raise rates this year. The Fed’s Beige Book released Wednesday showed the economy expanded across most regions and industries in the past two months, based on reports gathered on or before August 24. The odds of a rate increase at the September meeting are 32 percent compared with 30 percent a week ago.
Holdings in exchange-traded products backed by gold fell 6.9 metric tons on Tuesday to 1 522.7 tons, the biggest drop since July 31. Assets have shrunk 11 percent in the past year as some investors lost faith in the metal as a store of value.
Gold futures for December lost 0.1 percent to $1,132 on the Comex in New York. Silver for immediate delivery was little changed at $14.6755 an ounce. Platinum retreated 0.3 percent to $1 012.15 an ounce, while palladium climbed 0.1 percent to $584.79 an ounce.
BLOOMBERG