Gold treads water ahead of US nonfarm payrolls report

Synopsis

Gold prices held steady during the early hours of Thursday’s Asian trading. Investors are closely monitoring the upcoming U.S. nonfarm payrolls data, as it may impact the Federal Reserve's policy directions. Additionally, ongoing geopolitical tensions in the Middle East are adding to market volatility. Other precious metals displayed varied performance as trading commenced.

Gold held steady in early Asian trade on Thursday as investors awaited ​U.S. nonfarm payrolls data that could ​help shape expectations for the Federal Reserve's next policy move.

FUNDAMENTALS

Spot ​gold held its ground at $4,386.28 per ounce by 0046 GMT. Prices bounced from a near one-month low on Wednesday after the U.S. dollar and Treasury yields retreated from recent highs.

U.S. gold futures ‌for December ⁠delivery rose ⁠0.4% to $4,432.10.

Key U.S. nonfarm payrolls data is due on Friday. Meanwhile, the ADP National Employment Report ​showed U.S. private payrolls increased less than expected in August.

U.S. economic activity increased modestly, employment ​rose slightly and prices increased moderately in recent weeks, according to a mixed report published on Wednesday by the Fed that may do little to convince central bank ​policymakers one way or another as they weigh whether to ⁠raise interest ‌rates at their September 15-16 meeting.

Markets are pricing in ​a 62% ​probability of a U.S. rate hike this month, the CME FedWatch ⁠Tool showed.

Gold is traditionally seen as an inflation ​hedge, but higher rates increase the opportunity cost of holding the non-yielding ​asset.

On the geopolitical front, fears of renewed escalation gripped the Middle East after the United States and Iran exchanged their biggest barrage since July, with Washington striking Iran's southern coast and Tehran firing at U.S. bases across the region.

Elsewhere, the Dutch central bank said on Wednesday it had moved a large part of ‌its gold from North America to London over the past six months to be better prepared for a potential crisis amid rising geopolitical ​tensions.

Among ​other metals, spot silver ⁠was flat at $65.30 per ounce, platinum steadied at $1,760.33 and palladium fell 0.1% to $1,344.48.

DATA/EVENTS (GMT)

0145 China RatingDog Services PMI August

0750 France S&P Services PMI August

0750 France S&P Composite PMI August

0755 Germany S&P Services PMI ​August

0755 Germany S&P Composite Final PMI August

0800 EU S&P Services Final PMI August

0800 EU S&P Composite Final PMI August

0830 UK S&P Global PMI: Composite Output August

0830 UK Reserve Assets Total August

1230 US International Trade $ July 1230 US Initial Jobless Clm 29 August, w/e

1345 US S&P Global Comp PMI Final August

1345 US S&P Global Svcs PMI Final August

1400 US ISM N-Mfg PMI August

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